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| UBS doubles sub-prime writedowns | UBS doubles sub-prime writedowns |
| (about 5 hours later) | |
| Swiss financial giant UBS has reported that its writedowns as a result of the sub-prime crisis have more than doubled to about $37bn (£18.5bn). | Swiss financial giant UBS has reported that its writedowns as a result of the sub-prime crisis have more than doubled to about $37bn (£18.5bn). |
| It is the largest writedown by any bank since the credit crunch began. | It is the largest writedown by any bank since the credit crunch began. |
| UBS also announced that its chairman and former chief executive Marcel Ospel would not be seeking re-appointment. | UBS also announced that its chairman and former chief executive Marcel Ospel would not be seeking re-appointment. |
| The bank has announced $19bn of fresh asset writedowns on top of the $18.4bn it wrote off in 2007, as the value of its assets has plummeted. | The bank has announced $19bn of fresh asset writedowns on top of the $18.4bn it wrote off in 2007, as the value of its assets has plummeted. |
| UBS added that it was seeking to raise 15bn Swiss francs ($15bn; £7.5bn) in capital by issuing new shares. | UBS added that it was seeking to raise 15bn Swiss francs ($15bn; £7.5bn) in capital by issuing new shares. |
| Today's announcement will alarm both UBS shareholders and the markets Robert PestonBBC Business editor Read Robert's blogSwiss worry as bank giants fallLink to UBS shareprice | Today's announcement will alarm both UBS shareholders and the markets Robert PestonBBC Business editor Read Robert's blogSwiss worry as bank giants fallLink to UBS shareprice |
| Its losses dwarf those declared by US banks such as Citigroup ($21.1bn) and Merrill Lynch ($22bn). | Its losses dwarf those declared by US banks such as Citigroup ($21.1bn) and Merrill Lynch ($22bn). |
| Widespread damage | Widespread damage |
| The UBS announcements came as it said it expected to post a first-quarter net loss of $12.1bn. | The UBS announcements came as it said it expected to post a first-quarter net loss of $12.1bn. |
| The firm said that the next chapter of the firm's history would be one of "discipline and determination". | The firm said that the next chapter of the firm's history would be one of "discipline and determination". |
| "There will be other chapters which will not be perfect but none will be like the ones we have just written". | "There will be other chapters which will not be perfect but none will be like the ones we have just written". |
| The US sub-prime problems have hit the balance sheets of banks worldwide and have cost several leading bankers their jobs. | The US sub-prime problems have hit the balance sheets of banks worldwide and have cost several leading bankers their jobs. |
| Mr Ospel had previously said that he wanted to stay at the company for another year. | Mr Ospel had previously said that he wanted to stay at the company for another year. |
| MAIN CREDIT CRUNCH LOSSES UBS: $37.4bn Merrill Lynch: $22bnCitigroup: $21.1bnHSBC: $17.2bnMorgan Stanley: $9.4bnDeutsche Bank: $7.1bnBank of America: $5.3bnBear Stearns: $3.2bnJP Morgan Chase: $3.2bnBayernLB $3.2bnBarclays: $2.6bn IKB: $2.6bnRoyal Bank of Scotland: $2.6bnCredit Suisse:$2bnSource: Company reports Timeline: Sub-prime crisis | MAIN CREDIT CRUNCH LOSSES UBS: $37.4bn Merrill Lynch: $22bnCitigroup: $21.1bnHSBC: $17.2bnMorgan Stanley: $9.4bnDeutsche Bank: $7.1bnBank of America: $5.3bnBear Stearns: $3.2bnJP Morgan Chase: $3.2bnBayernLB $3.2bnBarclays: $2.6bn IKB: $2.6bnRoyal Bank of Scotland: $2.6bnCredit Suisse:$2bnSource: Company reports Timeline: Sub-prime crisis |
| "I have always stated that I ultimately take responsibility for the bank's situation," he said. | "I have always stated that I ultimately take responsibility for the bank's situation," he said. |
| "We have worked very hard and have been able to address the firm's most pressing problems, thereby laying the foundation for the long-term success of the bank." | "We have worked very hard and have been able to address the firm's most pressing problems, thereby laying the foundation for the long-term success of the bank." |
| He will be replaced by Peter Kurer, a 58-year-old Swiss lawyer who has spent the last seven years as the bank's main legal adviser. | He will be replaced by Peter Kurer, a 58-year-old Swiss lawyer who has spent the last seven years as the bank's main legal adviser. |
| Mr Ospel said that his successor had considerable experience of the banking sector "and importantly of this bank". | Mr Ospel said that his successor had considerable experience of the banking sector "and importantly of this bank". |
| Difficult year | Difficult year |
| UBS has also unveiled plans to create a new business that would handle US property assets which had become worthless. | UBS has also unveiled plans to create a new business that would handle US property assets which had become worthless. |
| It said that it was confident that this would "deal effectively with the firm's real estate exposures and allow the bank to focus on strengthening its core operations". | It said that it was confident that this would "deal effectively with the firm's real estate exposures and allow the bank to focus on strengthening its core operations". |
| Mr Osler said that a decision would be made "within weeks" about how many jobs would go at the firm. | Mr Osler said that a decision would be made "within weeks" about how many jobs would go at the firm. |
| UBS management warned that it expected 2008 to be a difficult year for the firm and the industry as a whole. | UBS management warned that it expected 2008 to be a difficult year for the firm and the industry as a whole. |
| In 2007 it reported its first annual loss since UBS was created from the merger of Union Bank of Switzerland and Swiss Bank Corporation in 1998. | In 2007 it reported its first annual loss since UBS was created from the merger of Union Bank of Switzerland and Swiss Bank Corporation in 1998. |
| Sub-prime loans were lent to US homebuyers with low incomes or with patchy credit ratings. These investments quickly soured as higher interest rates pushed up mortgage payments and triggered a wave of defaults. | Sub-prime loans were lent to US homebuyers with low incomes or with patchy credit ratings. These investments quickly soured as higher interest rates pushed up mortgage payments and triggered a wave of defaults. |
| As well as resulting in the collapse of Bear Stearns, it has also hit other big Western banks, including Wall Street giants Merrill Lynch, Citigroup and JP Morgan Chase. |