UBS will pay SFr2 billion ($1.73 billion) in bonuses for 2008 despite having lost billions and having received a government bailout, a Swiss newspaper has reported.This content was published on January 25, 2009 - 16:32
The Sunday broadsheet Sonntagszeitung said the bank agreed to the bonus with the Federal Financial Market Supervisory Authority (Finma), the Swiss financial regulator.
The amount equates to roughly SFr26,000 for each of UBS's 77,000 employees, although UBS had originally sought to pay out more than SFr3 billion.
UBS is also negotiating with Finma on a new compensation scheme, to be introduced in the second quarter, which would have managers only receive bonuses if the bank operated profitably.
UBS has written down $49 billion in the financial crisis and offloaded around $60 billion in toxic assets to the Swiss National Bank in 2008. The Swiss government also agreed to inject SFr6 billion of fresh capital into the bank in exchange for a 9.3 per cent stake.
UBS still expects to lose SFr8 billion in the fourth quarter.
The bank's management has received harsh criticism in Switzerland, leading it to agree to an advisory vote by shareholders on management pay and prompting some former managers to give back part of their bonuses.
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