By Douwe Miedema and Steve Slater
LONDON | Wed Sep 28, 2011 09: 12 BST
A brutal shrinkage after the passing of a view, the important customers globally wealthy player on a plan to its core will focus the investment bank which is LONDON (Reuters) - UBS.
The "one-stop-shop" model, which has defined the industry for the last two decades some can be their largest Rivalen--free from the Swiss Bank higher risks and cost of capital-from its top corporate and choose hedge-fund customers.
UBS (UBSN.)(VX) is due to reveal how it plans to scale in November, is say his want more reliable and less complexity, how it should be $ a 2.3 billion (1.47 billion pounds)-rogue trading scandal, which the head of Oswald Grübel Saturday resign forced restore.
Some in the industry think that these savings will result in the Bank, which quickly lose the skills that are essential for survival.
"No one has done before this, nobody has retrenched the EIB in this way, and no one knows quite impact on other business", said Chris Wheeler, banking analyst at Mediobanca.
Regulators force that banks reduce the risk in their companies, but the players such as j.p Morgan (JPM).(N) and Goldman Sachs (GS).(N), which have emerged strongly from the crisis not given up their search the League tables to above.
In previous administration UBS had the Investment Bank the 1995 acquisition of London merchant bank S.G. Warbug plc and the U.S. Investment Bank Dillon, read & co. built in 1997. It is now, which reverse and asset management will focus the core on his, for the needs of rich clients.
UBS ranks ninth in the League table for global M & –a this year, with Goldman Sachs and JP Morgan, Morgan Stanley (MS.)(N) leads. In Asia, where it has expanded aggressively, it was still third.
The Bank insists that it adhere to business model for the "integrated bank", which marries an investment bank with a private banking business for rich clients, even though the Investment Bank for asset management to shrink.
"I don't think we have an ambition to five pages and the size," the new Chief Executive Sergio Ermotti said hours after the interim CEO on Saturday named. "We have an ambition to top-3 in certain product areas."
Ermotti singled out as areas, where UBS strongly in the Forex trading and shares. But outsiders say that the Bank may be forced, more than she now understands to give up.
"I think not just accelerate the streamlining plan is enough," said Matthew Czepliewicz, an equity research analyst at Collins Stewart in London.
"If they consider capital of the Investment Bank and once again provide them then it will be longer term wealth management leave them in a better place, but so far they have not answered these questions", he said.
TOO DANGEROUS
Although UBS spin-off of the Investment Bank, would have it a hard time, the means it as a stand-alone unit-an idea of some on the market-discussed, because there do not have access to increasingly scarce ever depositors would have cash.
Others have proposed a management buyout, may revive the Warburg name, and may be on a small scale. This would however similar funding problems.
UBS denies that explores one of these options.
It is only the option key for UBS, each area consumes more stringent new standards among the capital accord Basel III how much capital to protect depositors from investment-banking losses with contraction of the EIB.
The capital intensity of the business unit is underlined by the fact that the Investment Bank accounted for 60 percent of the risk-weighted assets (RWA).(L) for UBS at the end of last year, but only 29 percent of the profit was wearing.
UBS can afford to stay in mergers and acquisitions (M & A), that uses relatively little capital, and is also their equity to keep platform markets analysts said even though they need to again more exotic equity derivatives.
The deepest cuts are probably on the stage.
"UBS shares is a leader and it has pockets of Forex, where it is strong, but it really nowhere in comparison to the others in fixed income and commodities and yet it has the cost base of the three players", said Simon Maughan, head trading for Europe at MF Global.
Fixed income and Rohstoffe--the sitzen-next to currencies in the FICC - that are likely to be the most affected areas, said analysts.
Rival Deutsche Bank (DBKGn.DE) recently said the Investment Bank had to go through a similar list 64 areas as important for their business determined and UBS may.
UBS to the 3,500 job cuts add, that it last month announced. About half were for the Investment Bank, intended to be about 10 percent of employees.
This uncertainty means that there may be a hard time keeping the banks that it considered the most valuable.
"(The savings) it is deep, but it is not clear whether they go further or even try to move it." It is difficult, as you yourself are dealing with a lot of jobs, and morality in the Bank already is at the low point, ", added the Mediobanca Wheeler."
A UBS banker said on condition of anonymity, speak that guaranteed bonuses could dissuade those who move to smaller boutique banks, but would not be enough, the banks keep jobs offered by larger colleagues.
(Additional reporting by Sophie Sassard;) (Editing by Alexander Smith)
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