New UBS boss seeks fresh start after trading scandal

Sat Sep 24, 2011 7:05pm EDT
 
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By Emma Thomasson and Catherine Bosley

ZURICH (Reuters) - The new interim boss of UBS faced a daunting task on Sunday as he tries to get the Swiss bank back on its feet after Oswald Gruebel quit as chief executive over the $2.3 billion loss it ran up in alleged rogue trading.

Sergio Ermotti said on Saturday the scandal had revealed a risk exposure that was "totally unacceptable" and his first priorities would be to review the bank's controls and conclude an internal investigation into the losses.

A 51 year-old from Switzerland's Italian-speaking region of Ticino, Ermotti was being groomed as a possible successor at the helm since he joined UBS as head of Europe, Middle East and Africa in April from UniCredit.

"We are aware that we are facing turbulent times externally and this latest incident is only adding much more necessity for us to react. But let's not forget that UBS is one of the best capitalized banks worldwide," he told journalists.

Gruebel, a 67-year-old banking veteran who helped turn around rival Credit Suisse last decade, was brought out of retirement to try to revamp UBS after it almost collapsed in 2008 under the weight of more than $50 billion lost on toxic assets.

UBS shares fell more than 10 percent since the news broke on September 15, trading at their lowest level since shortly after Gruebel took over in early 2009, but they rose 4.8 percent on Friday on hopes the board would agree a major restructuring.

Ermotti, who Chairman Kaspar Villiger said was a strong candidate to replace Gruebel permanently, said an internal investigation of what went wrong bank should conclude in 10 to 14 days although UBS might not be able to disclose its findings, pending external probes.

OPPORTUNITY OUT OF DISASTER   Continued...

 
<p>Oswald Gruebel, CEO of Swiss Bank UBS addresses a news conference to present the results for 2010 in Zurich February 8, 2011. REUTERS/Arnd Wiegmann</p>