UBS guts principal finance unit

After incurring $14.7 billion of losses in subprime-related write-downs last year, UBS is now closing its U.S. principal finance unit.

After incurring $14.7 billion of losses in subprime-related write-downs last year, UBS AG is now closing its U.S. principal finance unit.
UBS spokesman Doug Morris would not directly link the move to the $14.7 billion loss but did acknowledge that the principal finance unit had made the write-downs.
Marcel Rohner, UBS’s Chief Executive Officer, broke the news of the principal finance unit closing to employees of the Zurich, Switzerland-based bank in a Jan. 16 memo which said underwriting and trading positions would be cut in half from
In October, UBS also announced that 1,500 jobs would be cut in the bank’s investment-banking division https://www.investmentnews.com/apps/pbcs.dll/article?AID=/20071029/REG/71029007/-1/BreakingNews04&ht= (Investment News, Oct. 29).
“We will continue to examine and refine our strategy, with the objective of improving efficiency and returning the [fixed income nit] to profitability,” Mr. Rohner wrote.
UBS’s investment-banking division had 22,800 employees at the end of September and company officials did not indicate how many will be affected by the principal finance unit closing, saying only that 1,400 of the 1,500 job cuts previously announced have been made.