The bank reported losses in October of around £1.8 billion and it now expects to make an overall loss for 2007. The report is another knock to a major financial brand, with the Royal Bank of Scotland and Citibank both recently reporting losses.
To ensure that it is able to continue trading, the bank has received a £4.8 billion cash injection from the Government of Singapore Investment Corporation, with a Middle East investor putting forward a further two billion Swiss francs.
UBS has been the hardest hit by the financial turmoil, with a total of $13.5 billion written down. Citigroup has written down $11 billion, Merrill Lynch $8 billion, and Morgan Stanley $3.7 billion.
Marcel Rohner, group chief executive officer at UBS, said: “Conditions in the US markets have continued to deteriorate, and we have updated our loss assumptions to the levels implied by the current distressed market for mortgage securities.
“Continued speculation about the ultimate value of our non-conforming holdings – which remains unknowable – has been distracting. These write downs will create maximum clarity and will have the effect of substantially eliminating speculation.”
Peter Bolton King, chief executive at the National Association of Estate Agents, said: “The market is clearly not as strong now as it has been over the past seven years. While we expect to see a much more subdued picture in 2008, the underlying strengths remain the same.”
Answer ten questions to win Amazon vouchers!
Get the daily news delivered to your inbox
Find the latest industry jobs
