Troubled Swiss bank UBS writes down further losses

April 1st, 2008 - 4:39 pm ICT by admin  

Zurich, April 1 (DPA) Switzerland’s biggest bank announced it would raise further capital Tuesday as a result of worse losses than expected resulting from the sub-prime mortgage crisis. The bank predicted further losses of 12 billion francs ($11.9 billion) in the first quarter of 2008 after losses and write downs of approximately $19 billion dollars as a result of the US home loans crisis.

The bank, one of the worst hit, announced it intended to raise a further 15 billion francs and that chairman Marcel Ospel would not seek re-election at the AGM on April 23.

If shareholders accept the move, UBS will raise the extra capital in an underwritten rights issue.

Marcel Rohner, chief executive officer of UBS said in a statement the bank had made further prompt writedowns and reduced risk weighted assets to allow UBS to return to “sustainable value creation over time.”

He added: “With these measures we have created the basis to weather one of the most difficult periods in the history of the industry.”

Shareholders have already agreed to a cash injection of 13 billion francs from Singapore Investment Corporation (11 billion francs) and from an unnamed Middle East investor (2 billion francs) to help out the troubled bank.

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