UBS said the third-quarter result was helped by a SFr1.5bn (£1.06bn) own credit gain due to the widening of the bank's credit swaps in the third quarter. It will also book a SFr700m (£493m) gain on the sale of treasury-related investments in its wealth management division in Switzerland. And those investors can be happy that it’s pursuing business in growth areas such as Asia-Pacific, the Americas and the emerging markets, as well as expanding its global wealth management division.
Indeed, they’ll be thankful for any good news. UBS already lost chief executive Oswald Grübel last month, and he was only there having come out of retirement in 2009 to buoy the bank after another whopper – its near-collapse under the weight of more than $50bn of toxic assets. And with Grübel taking the blame for Adoboli’s alleged actions, it’s now down to interim chief executive Sergio Ermott to overhaul its troubled investment banking wing. This will be made more difficult by the fact that its strength buffer – the Tier 1 capital ratio – was expected to be slightly down on the second quarter because of the losses due to the trade.
Meanwhile the bank is also undergoing a major shake-up, shedding 3,500 jobs and shrinking its investment banking division, so that it winds up taking fewer risks, having a smaller balance sheet and using less capital, in order to produce ‘reliable returns’.
As for the less reliable activity it’s seen of late, Adoboli’s lawyer, Patrick Gibbs, described his client as ‘sorry beyond words for what had happened’. That’s all right then. Given that the bank’s still turning a profit, it may just give him a day off and chalk it up to experience…