Fresh losses at UBS dent hopes of a quick recovery

TROUBLED Swiss lender UBS saw its second quarter losses widen by a factor of three yesterday, as its bottom line was dented by charges on its own debt, a loss on the sale of its Brazilian unit and job cuts.<br /><br />The bank fell to a quarterly net loss of Sfr1.4bn (&pound;780m), down from a Sfr395m loss in the same period of last year and just below an analysts&rsquo; consensus forecast of Sfr1.32bn loss.<br /><br />The results were impacted by Sfr582m in restructuring charges, after chief executive Oswald Gruebel slashed 7,500 jobs.<br /><br />UBS also lost Sfr492m on the sale of UBS Pactual in Brazil, as well as taking a Sfr1.2bn charge on its own debt.<br /><br />In wealth management, pre-tax profits fell from Sfr1.07bn last year to Sfr932m, as the lenders&rsquo; clients withdrew Sfr22.3m.<br /><br />Outflows were partly due to the ongoing tax dispute with US tax authorities, who have demanded that the bank hand over details of 52,000 US citizens suspected of tax evasion. <br /><br />In investment banking, UBS narrowed last year&rsquo;s Sfr3.1bn loss to Sfr1.84bn, while asset management booked a pre-tax profit of Sfr82m, reversing last year&rsquo;s loss of Sfr59m.<br /><br />Gruebel offered little to be optimistic about, despite his ongoing efforts to turn the bank around.<br /><br />He said: &ldquo;The overall economic environment in most of the regions in which we operate remains recessionary. Sustainable recovery is not yet visible.&rdquo;<br /><br />UBS is also close to hiring former Merrill Lynch executive Bob McCann to help resolve its tax dispute.