UBS chief says bank in “position of strength”

The CEO of UBS, Sergio Ermotti, says that the Swiss bank is now in a “position of strength” with its new strategy.

But he warned in an interview with the NZZ am Sonntag newspaper that the bank, which has recently been hit by a rogue-trading scandal, could not eliminate risk totally.

UBS announced on November 17 that it would will dramatically cut back its investment bank as well as slash risky assets by almost a half. It is also to pay its first dividend since the financial crisis. 

Ermotti told the NZZ am Sonntag that UBS wanted to give shareholders good yields but with a smaller risk. This means that UBS would have to adapt to a new market environment and take onboard the Basel III stringent international banking regulations, he said.

The new CEO’s appointment was confirmed on November 15 and filled a leadership vacuum after former CEO Oswald Grübel quit the bank in September following a $2 billion (SFr1.82 billion) rogue trading scandal.

Ermotti said in the interview that the bank was carefully examining its risk controls in the wake of scandal but that there was no such thing as a “risk-free bank”.

“With 65,000 employees we’re going to have such cases now and again. We have to, however, have these risks so under control that the consequences, financially and for our reputation, remain within acceptable limits,” he said.