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UBS posts fresh $10bn write-down UBS posts fresh $10bn write-down
(about 3 hours later)
Swiss investment bank UBS has reported a further $10bn (£4.9bn) in write-downs from its exposure to bad debt in the sub-prime US mortgage sector.Swiss investment bank UBS has reported a further $10bn (£4.9bn) in write-downs from its exposure to bad debt in the sub-prime US mortgage sector.
It had already warned in October that the crisis had cost it about 4bn Swiss francs ($3.5bn; £1.8bn). It had already said in October that the crisis had cost it about 4bn Swiss francs ($3.5bn; £1.8bn).
The firm said that the hit meant it may now make an overall loss in 2007.The firm said that the hit meant it may now make an overall loss in 2007.
UBS also revealed that it had received a 11bn Swiss francs ($9.7bn; £4.8bn) injection from the Government of Singapore Investment Corporation.UBS also revealed that it had received a 11bn Swiss francs ($9.7bn; £4.8bn) injection from the Government of Singapore Investment Corporation.
A Middle East investor - thought to be the Oman government - has put a further 2bn Swiss francs into the bank. The sub-prime write-down represents more than a monetary loss for UBS. It's a serious blow to a valuable brand Robert PestonBBC business editor class="" href="http://www.bbc.co.uk/blogs/thereporters/robertpeston/2007/12/the_ubs_horror_show.html">Read Robert's blog
A Middle East investor - reported to be the Oman government - has put a further 2bn Swiss francs into the bank.
BBC business editor Robert Peston said that the fact UBS had felt the need to raise so much new capital was "all you need to know about the gravity of what has occurred, both for UBS and for the world financial system".
"It's further evidence of the transfer of financial power from the western economies to the great cash generating economies of Asia, Russia and the Middle East - which are able to dictate the terms on which they prop up our important institutions," he added.
Hedge fund woesHedge fund woes
Announcing the fresh write-down, UBS said that it had "revised the assumptions and inputs used to value US subprime mortgage related positions". Announcing the fresh write-down, UBS said that it had "revised the assumptions and inputs used to value US sub-prime mortgage related positions".
It had cautioned in that further bad debt write-downs might be necessary in the near future. In October, UBS had warned that further bad debt write-downs might be necessary in the near future.
A string of global banks have indicated how much it they have lost as a result of exposure to investment products linked to US sub-prime mortgages.A string of global banks have indicated how much it they have lost as a result of exposure to investment products linked to US sub-prime mortgages.
Chief executive Marcel Rohner and other senior managers are due to address investors and analysts on Tuesday about the bank's prospects. UBS chief executive Marcel Rohner and other senior managers are due to address investors and analysts on Tuesday about the bank's prospects.
Mr Rohner replaced Peter Wuffli in the top job at UBS in July.Mr Rohner replaced Peter Wuffli in the top job at UBS in July.
Although no reason was given for Mr Wuffli's departure, his leaving followed after three quarters of falling profits and $300m losses at a failed hedge fund. Although no reason was given for Mr Wuffli's departure, he left after three quarters of falling profits and $300m losses at a failed hedge fund.