UBS’s investment banking chief Carsten Kengeter has blamed the media for providing “ill-informed” coverage of the lender’s losses from its “rogue” trading fiasco.
In a letter sent to employees of the battered division yesterday, he wrote: “Do not be distracted by the often ill-informed media commentary around this event. It will fade quickly as the facts become known.”
He also tried to rally workers in the investment bank, which is already enduring heavy job losses and is likely to see more as a result of the $2.3bn (£1.5bn) losses incurred due to “unauthorised trades”.
“We must channel the emotion and disappointment felt by everyone across the firm,” Kengeter said, telling his staff that UBS’s “healthy and vibrant investment bank” is crucial for the rest of the lender’s operations.
He also tried to counter suggestions that clients were ready to abandon the bank. “Clients are inundating us with messages of support, and placing new business with us, showing how much they want us to succeed,” he claimed.
And he promised switch action for those in charge of the bank’s failings: “We will deal appropriately with those individuals who were responsible for significant operational and management supervision lapses, and then we must move on.”
However, markets are anticipating a significant scaling back of the investment bank.
Collins Stewart analyst Matthew Czepliewicz said that shrinking the division would be “positive for the share price”, but also warned: “Key questions raised by the trading loss about the integrity of internal over-sight systems remain unanswered.”