As you may have heard, UBS announced last week that it'd lost about $2 billion, a ballpark figure that the bank said today is actually closer to $2.3B. Separately, you may have also heard that the past several years? Have not been the best of times for the Union Bank of Switzerland, which has been plagued by layoffs, shitty bonuses, and mandates where, for instance, employees have been forced to run out and buy ties and then told "nevermind, you don't need them" after it's too late to make a return for anything but store credit. The news that a rogue trader named Kweku Adoboli had racked up a loss massive enough to potentially wipe out third quarter profits would be viewed by most as the latest kick in the pants for the Swiss bank, and presumably not something management would be pleased to hear. Or would they? According to one analyst, Adoboli may have just solved their problems.
“UBS wants to downsize its investment banking unit anyway and they were never going to pay big bonuses for 2011 in the first place,” Dirk Becker, a Frankfurt-based analyst at Kepler Capital Markets, said by phone. “With this trading loss there is now very good justification not to do so.”
Funny how all the talk re: Adoboli is about him royally screwing UBS when maybe it should be about how he so obviously helped them out of a bind. They were going to fire a bunch of people and issue zero dollar bonuses anyway and now, a lot of the heat will be taken off them for doing so. You guys in Zurich can feel free to start thanking him at any time (verbally and via Edible Arrangements).
UBS Bonuses At Risk After $2.3 Billion Loss [Bloomberg]