The country's biggest bank, UBS, warned on Thursday that it expects its private equity arm, UBS Capital, to post big losses this year as the economic slowdown begins to bite.
The bank said the decline in share values and the thin market in initial public offerings would weigh on earnings. For the second, third and fourth quarters of the current year, the bank said pre-tax losses would total SFr350 million to SFr400 ($204 million to $233 million). It added that most of the losses would be concentrated in the second quarter.
The portfolio of UBS Capital has a book value of SFr5.7 billion.
UBS announced earlier this month that it was postponing the planned spin-off of its private equity business due to the volatile markets and the head of the private equity, Pierre de Weck, left the group.
At the time, the bank said it did not expect to have to change its upbeat first quarter outlook for the group.
Swissinfo with agencies