Of Special Interest
- Financial wellness affects half of peoples’ mental or physical health, finds report
- Study finds traditional financial institutions embrace Fintech disruption
- Grass is greener for environmentally friendly businesses, finds Barclays
- Prospective homeowners would consider a 40-year mortgage to escape renting, finds Santander
- Millennials’ needs are changing the face of banking industry, says new report
- FS is putting consumer data at risk by failing to protect mobile apps, says Arxan
- A lack of belief in their ability holds 28% women back in work, says Cambridge & Counties
- ‘Which?’ reveals Scotland has lost over a third of its bank branches in eight years
- Next downturn unlikely to be as bad as 2008, according to S&P
- FCA reveals findings from first cryptoassets consumer research
- US consumers favour single mobile app for banking and payments
- Banks suffering major IT shutdowns every day, ‘Which?’ reveals
- The US will be a key offshore centre in 2019, says GlobalData
- Debit industry changes markedly in 10 years of the Debit Issuer Study
- UK's ‘Big Five’ face ‘too big to compete’ as small challengers secure stellar returns
- Banks as vulnerable now as before crash, says new study
- Leverage ratio a constant conundrum for European and US banks, says SNL
7th October 2011
UBS heads roll - rogue trading warnings ignored
Sergio Ermotti, UBS interim CEO issued an internal memo this week in which he explains some of the facts around the rogue trading incident. Specifically he discloses that internal control report warnings were not investigated properly and links this to the two further resignations.
". . .We have to be straight with ourselves. In no circumstances should something like this ever occur. The fact that it did is evidence of a failure to exercise appropriate controls. Our internal investigation indicates that risk and operational systems did detect unauthorized or unexplained activity but this was not sufficiently investigated nor was appropriate action taken to ensure existing controls were enforced.
"This is simply not acceptable. We all have signed our Code of Business Conduct & Ethics, we all know what is expected of us and we know what the consequences of failing to abide by this Code are. UBS will not tolerate any misconduct that damages the bank’s reputation. This is what we owe the vast majority of you who diligently uphold our principles and values and it is the only way to build a strong culture with our values uncompromisingly at the core.
"Today we have accepted the resignations of the co-heads of Global Equities. Firm disciplinary action will be taken against further individuals in Equities and across other responsible functions. We have also taken specific steps to address the failures identified."
Mike Stewart replaces the two as head of Global Equities. He was formerly with Bank of America Merrill Lynch.
Despite the $2.3bn charge for the rogue trading cost the bank may report a small profit for Q3. This is because the significant share price slide has significantly reduced the cost of its own debt.