News, Economy & Finance

Markets welcomed the appointment of a new general manager for UBS, which will resize the investment bank after the scandal caused by the loss of $ 2.3 billion resulting from unauthorized transactions of one of its traders to London.

By 0830 GMT, the action of UBS, which has already lost more than 34% since January, jumped 2.87% to 10.41 francs after opening down nearly 3%, while the European index banking shares were up 2.78%.

UBS has appointed Sergio Ermotti, responsible for Europe, the Middle East and Africa, to succeed Oswald Grübel, a former trader aged 67 came from Credit Suisse, which had been appointed head of UBS in 2009 to try to correct the bank after its near bankruptcy in 2008.

Speculation flourished after the departure of Oswald Grübel, some citing differences over strategy.

"Oswald Grübel leaves UBS at a difficult time.Not only the new regulations will impact the profitability of investment banking in the future but it is not yet clear whether customers money management retain their confidence in the bank by depositing funds in an atmosphere of shaking due to brokerage and risk control unbearable, "said Michael Rohr at Silvia Quandt Research.

Peter Thorne, an analyst at Helvea, for its part considers that the departure of Oswald Grübel and resizing of the investment bank should be regarded as positive developments.

"Perhaps the only surprise is that Sergio Ermotti was not appointed permanently," he adds.

Sergio Ermotti, including Kaspar Villiger said it could be a good candidate to keep the job permanently, said in a video conference with reporters that UBS would strengthen its controls on risks at group level.

"We expect that Sergio Ermotti accelerates the implementation of a strategy focused on clients in the investment bank, focuses on the efficiency of capital and rapidly improving risk management," said Teresa on his side Nielsen, an analyst at Bank Vontobel.

Resizing DELICATE

"It is a powerful sign that UBS will now focus on money management, with an investment bank in support of these activities," said a fund manager who worked with Oswald Grübel to the bank of Credit Suisse investment.

The departure of Carsten Kengeter, director of investment banking, was also discussed but President Kaspar Villiger has defended him by praising the "excellent work" done to limit losses after the discovery of unauthorized transactions.

"But it is not important because Kaspar Villiger is itself the beginning," has tempered a broker based in Zurich, recalling that Weber should succeed him in April 2013.

"Grübel did not resign, he was pushed out. It might have been better if Casten Kengeter Miscovic and Maureen, the head of risk management, fraud had paid for discovery," said a fund manager UBS.

"We do not share the enthusiasm of investors for the strategic shift," said Dirk Becker at Kepler Capital Markets, for whom such an operation in the investment bank will be difficult because it employs 17,000 people and 135 billion francs in risky assets.

"The loss could also deal a blow to consumer confidence and cause new outflows in money management.We remain cautious, "he added.

Jon Peace at Nomura believes that UBS for its part should be able to succeed at the game "We do not believe the damage the image will result in bleeding, especially in an environment where their peers are affected by other problems sometimes of a judicial nature. "