UBS INVESTMENT Bank has axed its entire macro directional trading team, with the loss of 13 jobs.
David Tait, managing director and global head of macro directional trading, resigned last Friday after UBS announced the closure of his trading team the previous day.
Tait is currently on gardening leave before taking up a new role at a rival investment bank.
The remaining 12 traders in Tait’s team are expected to secure new jobs at hedge funds, after being approached by a number of firms to move either individually or as a group.
Sources close to UBS said it had already decided to cut 1,600 jobs in its investment banking arm worldwide, as part of a wider drive to cut costs by £1.5bn by the end of 2013.
But another source maintained the closure of the macro-directional trading division was a result of the alleged £1.5bn fraud by Kweku Adoboli, as the Swiss bank moves to de-risk its investment banking business.
The source told City A.M.: “UBS has withdrawn from all types of directional risk-taking as a consequence of Kweku Adoboli. The core of the UBS business is wealth management, and from a reputational point of view, UBS Investment Bank has not done itself any favours.”
Yesterday Mike Stewart, who has replaced Francois Gouws and Yassine Bouhara after they quit as co-heads of global equities over the “rogue” trade, told staff he is under “no illusion” about the challenges faced by the bank and the rest of the industry.
His comments came 24 hours after acting chief executive Sergio Ermotti admitted UBS had seen signs of suspect trades. He said “risk and operational systems did detect unauthorised or unexplained activity but this was not sufficiently investigated, nor was appropriate action taken.”