UBS Replaces Johansson as Head of Investment Bank After Losses

April 27 (Bloomberg) -- UBS AG, the European bank with the largest losses from the credit crisis, replaced Jerker Johansson as head of its investment bank as Chief Executive Officer Oswald Gruebel shakes up management two months after joining.

UBS named Alexander Wilmot-Sitwell and Carsten Kengeter co- heads of the division. Johansson, 52, who joined UBS in March 2008 after 22 years at Morgan Stanley, has resigned with immediate effect, Zurich-based UBS said in a statement today.

The appointment is the second change among top executives since Gruebel, the former CEO of Credit Suisse Group AG, was hired out of retirement in February. Gruebel, 65, named Ulrich Koerner chief operating officer earlier this month, announced an additional 7,500 job cuts and agreed to sell the Brazilian banking operations to reduce risk and free up capital.

“Gruebel is reviewing the senior management at UBS and making the changes that he believes to be necessary to create his UBS,” Peter Thorne, a London-based analyst with Helvea, said in a note. “We look for the new management team to accelerate the transformation of the investment bank.”

Treasury says about $110B left in bailout fund

WASHINGTON (AP) -- Only $109.6 billion in resources remain in the government's $700 billion financial rescue fund.

But Treasury Department officials said Tuesday they expect the fund will be boosted over the next year by about $25 billion as some institutions pay back money they have received. That would boost the total to $134.6 billion.

UBS to Sell Brazilian Unit

ZURICH -- UBS AG said Monday it will sell Banco Pactual back to one of the Brazilian investment bank's original owners at a loss, a move that will lift the Swiss bank's capital.
UBS said Pactual will be sold for $2.5 billion to BTG Investments, a firm run by Andre Esteves, the former Pactual partner who briefly ran UBS's troubled fixed-income business before exiting the Swiss bank last summer.

UBS said the sale is in keeping with its strategy to reduce risk and strengthen its balance sheet, a push reinforced by new Chief Executive Oswald Grübel, who was hired in February to steer UBS through what now amounts to over $50 billion in write-downs.

The move shows that Mr. Grübel, who last week said he wants to cut spending by up to 4 billion Swiss francs ($3.43 billion) by next year -- including through an 11% reduction of its work force -- won't shirk from further painful steps to restore UBS's profitability.

Despite incurring a loss on the sale, UBS said the move will bolster its Tier 1 ratio -- a measure of capital strength -- by 0.6%, meaning its first-quarter ratio will stand at roughly 10.6%.
"The increase in the Tier 1 ratio, albeit only 60 basis points, is welcomed as the Tier 1 ratio had fallen to around 10% after the first-quarter loss," said Peter Thorne, analyst at independent brokerage Helvea.

Recent Q1 Results 2009

ZURICH (Dow Jones)--UBS AG (UBS), hit by the effects of the global economic crisis and a crackdown by U.S. tax authorities, Wednesday said it expects to report a first-quarter net loss of nearly 2 billion Swiss francs ($1.75 billion) and that it will slash over 11% of its workforce to cut costs.

NEW YORK (AFP) — Banking giant JPMorgan Chase announced on Thursday it had made net profit of 2.1 billion dollars in the first quarter of 2009. "The firm earned more than two billion dollars this quarter, despite extremely high credit costs," chief executive Jamie Dimon said in a statement.

New York, Apr 14, 2009 (Asia Pulse Data Source) -- Financial services major Goldman Sachs Group Inc has announced net earnings of USD 1.81 billion in the first quarter of this year and will raise about USD 5 billion through public offering.

CHARLOTTE, N.C. (AP) -- Bank of America Corp. warned of worsening loan default problems Monday even as it posted a first-quarter profit of $2.81 billion. During the quarter, revenue more than doubled to $35.76 billion, mainly from the addition of Merrill. It was also helped by a $1.9 billion pre-tax gain from selling shares it owned in China Construction Bank. Bank of America continues to own about 17 percent of the common shares of the Chinese bank, it said. Analysts expected revenue of $27.13 billion. However, Bank of America recorded a $13.4 billion provision for credit losses in the first quarter, showing that it is not immune from deteriorating credit quality and growing unemployment. The bank set aside $6.4 billion as additional reserves to cover future losses.

Citigroup (NYSE: C) reported a Q1 loss of $0.18 per share, better than the consensus of $0.34 loss. Revenues came in at $24.8 billion, versus the consensus of $21.95 billion. Results also include $7.3 billion in net credit losses and a $2.7 billion net loan loss reserve build. The $0.18 loss per share reflected the reset in January 2009 of the conversion price of the $12.5 billion convertible preferred stock issued in a private offering in January 2008. This did not have an impact on net income but resulted in a reduction to income available to common shareholders of $1.3 billion or $0.24 per share. Without this reduction, earnings per share were positive. CEO Vikram Pandit said, "Our results this quarter reflect the strength of Citi's franchise and we are pleased with our performance. With revenues of nearly $25 billion and net income of $1.6 billion, we had our best overall quarter since the second quarter of 2007."

Morgan Stanley reports Q1 net loss (Banking Business Review - 27-April-2009)
Morgan Stanley has reported a net loss of $177m, or $0.57 per diluted share, for the first quarter ended March 31, 2009, compared to a net income of $1.41 billion, or $1.26 per diluted share, in the corresponding quarter of 2008. Net revenues for the first quarter of 2009 were $3 billion, a decrease of 62% over the first quarter of 2008. Non-interest expenses of $3.9 billion decreased 33% from the first quarter of 2008. The company has said that the first quarter results were negatively impacted by the $1.5 billion decrease in net revenues related to the tightening of Morgan Stanley's credit spreads on certain of its long-term debt and net losses of $1 billion on investments in real estate, amidst the industry-wide decline in this market.

Credit Suisse puts global competition in shade
Swiss bank Credit Suisse has outperformed international competitors with a better-than-expected SFr2 billion ($1.7 billion) profit in the first three months of the year. The bank continues to attract new money from wealthy clients, but the key to success has been an impressive investment banking performance – the very activity that brought the industry to its knees. The news from Credit Suisse provides one of the few rays of hope for a banking industry still mired in the aftermath of the financial crisis. UBS expects to lose the same amount as its Swiss rival gained in the first quarter.

UBS Expects Near-CHF2B 1Q Loss; To Cut 11% Staff

ZURICH (Dow Jones)--UBS AG (UBS), hit by the effects of the global economic crisis and a crackdown by U.S. tax authorities, Wednesday said it expects to report a first-quarter net loss of nearly 2 billion Swiss francs ($1.75 billion) and that it will slash over 11% of its workforce to cut costs.

Chief Executive Oswald Gruebel said UBS' outlook remains cautious because of the many uncertainties that the Zurich-based bank faces.

UBS said it had roughly CHF3.9 billion in write-downs in the first quarter related to illiquid securities, expenses for credit losses, and the lower value of assets on the remaining positions transferred to the Swiss National Bank as part of a government shore-up. Both the quarterly net loss and write-downs were wider than analysts had expected. Full earnings are scheduled May 5. UBS reported a net loss of CHF20.89 billion for the full year of 2008.

Under Gruebel, who was installed as CEO six weeks ago, UBS aims for cost savings of CHF3.5 billion to CHF4 billion by the end of 2010 over costs in 2008, when the bank spent CHF28.56 billion, translating to cuts of up to 14%.

A large chunk of this will be achieved through 8,700 job cuts, with UBS expecting to reduce overall staff to 67,500 from 76,200 at the end of March. Home market Switzerland accounts for 2,500 of the jobs to go, with up to 1,500 formal layoffs "unavoidable," the bank said.
UBS has cut roughly 11,170 jobs since it began writing down mortgage-related securities, not including the 8,700 announced Wednesday.

UBS said its Tier 1 ratio - a measure of capital strength - will dip to roughly 10% at the end of March, which is seen by analysts as the lower end of what UBS needs, from 11.5% at year-end.
"This raises the question of whether more capital will be needed," Credit Sights analyst Simon Adamson wrote.

Gruebel seemed to acknowledge the thin capital, saying UBS will do whatever is necessary to "immediately protect and strengthen our capital base."

"Markets remain extremely unstable, and we will not simply wait and hope for better times," Gruebel told shareholders, whom he addressed for the first time Wednesday.

Wall Street Meltdown .... Funny

Funny song ...... how appropriate

http://www.youtube.com/watch?v=Nay4VbUJl3E

RBS May Cut 9,000 Jobs to Help Repay U.K. Bailout

April 7 (Bloomberg) -- Royal Bank of Scotland Group Plc, the biggest bank controlled by the U.K. Treasury, may eliminate an additional 9,000 jobs worldwide as it seeks to repay a government bailout.

The cuts total about 5 percent of RBS’s global workforce. The actual number of jobs lost may be “significantly lower” because of efforts to shift employees into new positions, Edinburgh-based RBS said in a statement.

RBS may be forced to eliminate more positions as it seeks to pay off government aid and return the bank to shareholder control. The government today increased its stake in RBS to 70 percent after investors shunned a rights offering. The bank plans to reduce costs by 2.5 billion pounds ($3.7 billion), or 14 percent, over the next three years.

TIMELINE-UBS

April 1 (Reuters)

Following is a timeline on UBS since the start of the financial crisis:
May 3, 2007 -- UBS shocks investors by closing its Dillon Read hedge fund unit, which had a reputation as a serial outperformer, after it posted lower-than-expected results.

Oct. 1 -- UBS warns a 4 billion Swiss franc ($3.45 billion) subprime hit would cause a third-quarter pretax loss. A few weeks later, UBS reports a quarterly loss of 726 million Swiss francs, its first quarterly loss in nine years.

Jan. 30, 2008 -- UBS announces another writedown, this time for $4 billion. Two weeks later the bank posts a full-year loss of 4.4 billion Swiss francs. Shareholders back an $11.9 billion capital injection from Singapore and a Middle East investor.

April 1 -- UBS doubles its writedowns, dumps its chairman, Marcel Ospel, and seeks more emergency capital. It proposes its lawyer, Peter Kurer, as Ospel's successor.
- Activist investor and former chief executive Luqman Arnold then demands UBS shake up its governance and structure.

May 6 -- UBS says it will axe 5,500 jobs and sell billions of dollars of ailing assets in a bid to break free from the subprime crisis.

June 19 -- A former UBS banker who once smuggled a client's diamonds into the U.S. in a toothpaste tube pleads guilty to helping a billionaire hide $200 million in assets from U.S. tax authorities, part of a broader tax evasion probe of UBS.

Aug. 12 -- UBS says it will separate its wealth management business from investment banking, acknowledging flaws in its one-bank strategy.

Oct. 16 -- UBS announces it is to get 6 billion Swiss francs from the Swiss government for a 9.3 percent stake and is to unload $60 billion of toxic assets into a new central bank fund.

Nov. 12 -- Raoul Weil, head of UBS AG's wealth management business, is charged with conspiring to help thousands of wealthy Americans hide $20 billion of assets from U.S. tax authorities in Swiss bank accounts.

Feb. 10, 2009 -- Posts the biggest ever annual loss for a Swiss company, but says client withdrawals reversed in January. It says it will axe 2,000 more jobs as it restructures to focus on wealth management.

Feb. 18 -- Agrees to pay $780 million and identify certain U.S. clients following criminal fraud charges that it assisted rich Americans to evade taxes.

Feb. 20 -- Warns that it could go out of business if it complies with an order to reveal names of thousands of suspected U.S. tax dodgers with secret offshore accounts at the bank.

Feb. 24 -- UBS may reportedly face a mini-trial in a U.S. court in July as it fights efforts to force it to disclose names of 52,000 U.S. clients suspected of offshore tax evasion. Feb. 26 -- UBS appoints Oswald Gruebel, former head of rival Credit Suisse, as chief executive, replacing Michael Rohner, CEO for the previous 18 months.

March 1 - Gruebel says that it could take two to three years to bring UBS back to making a sustainable profit.

March 4 -- Chairman Peter Kurer steps down and Kaspar Villiger, a former Swiss finance minister, is nominated as a replacement.

March 5 - Fitch Ratings cuts its ratings on UBS's preferred shares into junk territory, citing increased risks that weak earnings may lead to the bank deferring dividend payments on the securities.

March 11 - UBS revises its 2008 net loss to 20.9 billion Swiss francs ($18.06 billion) -- the biggest in Swiss corporate history -- from the previously reported 19.7 billion francs. UBS says it predicts tough times ahead.

March 19 - UBS says it would buy back up to 1 billion euros ($1.37 billion) of four bond issues to bolster its Tier-1 capital ratio, a measure of its ability to handle losses.

March 30 - A U.S. judge dismisses putative class action lawsuits seeking damages against UBS over allegations of securities fraud in the auction rate securities market. The first lawsuit was filed in March 2008.

April 1 - UBS appoints former Credit Suisse executive Ulrich Koerner as chief operating officer. Koerner has a track record as a "turnaround manager" at Credit Suisse.