UBS forced to write down another $US5bn

UBS,the Swiss
banking giant, has been forced to write down another $5bn (£2.79bn) in assets,
on top of the $42.5bn in its sub prime-related assets written down already, and
is expected to record a loss in the second half of the year.

Sub prime losses account for $1bn of the writedowns and Alt-A loans, the
next lending classification after sub prime in credit terms, represent another
$1bn, according to the Evening Standard.

UBS investments in bond insurers will account for the rest of the writedown.
The bank has already written down $42.5bn on its sub prime-related assets and
recorded a net loss of Sfr358m (£217.6m) in the second quarter.

Chairman Peter Kurer maintained the bank would be profitable from next year,
likening UBS’s position to the second face in the aftermath of a bad storm: ‘One
must first remove the fallen trees, then tidy up the house and cellar, and in
the third phase, bring the shine back to the house’.

Further reading:

UBS looks to settle private banking tax issues

The Evening Standard story

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