Chillin' out till it needs to be funded
UBS posted a $1.3 billion quarterly loss on Tuesday, the third in a row for Switzerland’s biggest bank, and blamed costs linked to its reorganization program.The loss widened to 1.4 billion Swiss francs in the second quarter from 395 million francs in the same period a year earlier. The company cited costs related to job cuts and charges to improve the bank’s debt position, and it said clients continued to withdraw money from its wealth management units even though the rate of net outflows slowed from the first quarter.The bank gave a bleak outlook, saying that a sustainable economic “recovery is not yet visible.”“Our outlook remains cautious, consistent with our view that economic recovery will be constrained by low credit creation and the structural weaknesses in consumers’ and governments’ balance sheets,” the bank said in a statement.Oswald Grübel, the bank’s chief executive, has cut about 7,500 jobs, reduced risk-weighted assets and sold a unit in Brazil in an effort to return the company to profitability. Credit Suisse and other UBS rivals have recently reported higher earnings as strong performances of their investment banking units outweighed rising bad loans at their retail operations. At UBS, the investment banking business had a pretax loss of 1.85 billion francs, down from 5.24 billion francs a year ago.
Also, another 16.5 billion CHF have flown from the bank and the legal battles with US may be closed soon. But $UBS is not bankable anymore