Director resignations add to UBS troubles

Four board members have unexpectedly resigned from Swiss bank UBS, which was already reeling from huge subprime losses and a United States tax evasion probe.

No reason was given for the departure of a third of the bank’s board two months after its annual general meeting. UBS’s new corporate governance code, separating board and executive powers, started on Tuesday.

Stephan Haeringer, Rolf Meyer, Peter Spuhler and Lawrence Weinbach will leave the embattled bank in October. An emergency general meeting has been called for that month to elect replacement board members.

Weinbach had been re-elected for office by UBS shareholders in April and all four were just two months into their year-long tenure.

UBS has been one of the banks worst hit by the US subprime mortgage crisis, writing off some SFr39 billion in recent months.

It announced plans to cut about 5,500 jobs, or seven per cent of its workforce, in May after reporting a first-quarter loss of SFr11.5 billion ($11.1 billion). The Swiss press has been speculating about more losses in the second quarter, which has just ended.

The bank has been further rocked by a former employee recently admitting in a US court to helping US citizens evade taxes. This has been accompanied by an investigation by the US tax authorities into UBS’s activities in the country.