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UBS CEO Says Clients’ FX Losses Aren’t a Governance Issue

(Bloomberg) — UBS Group AG Chief Executive Officer Sergio Ermotti said that the steep losses incurred by clients on complex currency derivatives don’t point to deeper problems at the Swiss lender.

“The situation is not indicating to me any issues around governance or suitability controls” at UBS, Ermotti told Bloomberg TV on Wednesday when asked about the matter. Instead, he said the derivatives losses were “the unfortunate outcome of people not using it in the right way.”

The losses have become a reputational issue for UBS in its home market Switzerland. They were incurred when the currencies underlying the derivatives moved in unexpected directions, causing some clients to lose more money than invested, lawyers who represent affected clients previously told Bloomberg News.

UBS is reviewing the role of six relationship managers in the matter, some of whom have already departed the bank, Bloomberg reported earlier this month.

Ermotti said in the TV interview on Wednesday that UBS had compensated some clients.

“This is a matter that is affecting less than 200 clients in very specific locations” as well as “a handful of client advisers,” Ermotti said. “We had more than 3,000 clients using these products within a very defined asset allocation and risk appetite framework.”

The products known as Range Target Profit Forwards are complex currency derivatives that are hard to understand for unexperienced investors, according to the Swiss retail investor association SASV, which says it’s in touch with affected clients. In an RTPF, regular payments are made if a certain exchange rate remains within a predefined range, but investors are exposed to considerable risk of loss outside that range, according to SASV.

Some Swiss clients “had exposure to a product outside our standard asset allocation framework or their particular individual risk capacity” and they “experienced losses mainly arising from US tariff-related market volatility in April,” UBS Chief Financial Officer Todd Tuckner said Wednesday on an earnings call with analysts.

The financial impact from agreements with affected clients “is substantially captured in our second-quarter results,” Tuckner said without specifying an amount.

–With assistance from Myriam Balezou.

(Updates with CFO comments in final two paragraphs.)

©2025 Bloomberg L.P.

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