UBS aims to be No.1 in eq­ui­ties trad­ing

The Pak Banker - - Front Page -

ZURICH: UBS wants to re­gain its top po­si­tion in eq­ui­ties trad­ing and be­come a top five fixed-in­come player as Switzer­land's biggest bank pushes to in­crease the prof­itabil­ity of its in­vest­ment bank, the di­vi­sion's co-chief was re­ported as say­ing on Fri­day, Reuters Re­ported.

UBS, which was forced to cut in­vest­ment bank­ing risk­tak­ing af­ter it wrote down more than $50 bil­lion in the credit cri­sis, forc­ing it to ac­cept a govern­ment bailout, re­ported a shock in­vest­ment bank­ing loss in the third quar­ter on slug­gish trad­ing.

The bank, which has hired around 1,000 new staff to bol­ster its in­vest­ment bank­ing busi­ness po­ten­tial needed to gain mar­ket share in key ar­eas to boost prof­itabil­ity, in­vest­ment bank co-chief Carsten Kengeter said in an in­ter­view with Swiss busi­ness mag­a­zine Bi­lanz.

"Cur­rently we are placed third. We have to be­come num­ber one again. And we will achieve this," Kengeter said, when asked about the banks eq­ui­ties trad­ing busi­ness.

The bank also needed to im­prove on its po­si­tion out­side the top 10 in fixed in­come trad­ing, he said.

"This busi­ness is only in­ter­est­ing from a profit point of view among the top five. We have to get there."

Kengeter told in­vestors in Novem­ber that UBS was well placed to ben­e­fit from an up­turn in client ac­tiv­ity af­ter hir­ing new staff, though trad­ing growth would also mean more risk.

UBS is fo­cus­ing its in­vest­ment bank­ing ac­tiv­i­ties on the client flow busi­ness and away from riskier pro­pri­etary trad­ing. New Zealand banks will be an im­por­tant profit driver for their own­ers next year for the first time in a decade, UBS says. Prof­its from the New Zealand di­vi­sions of the Aus­tralian banks have re­peat­edly dis­ap­pointed for years, a UBS re­port says.

The four big trad­ing banks, ANZ Na­tional, ASB, Bank of New Zealand and West­pac re­ported com­bined 2010 ful­lyear prof­its af­ter tax of $2.2 bil­lion, up 14 per cent on the last year. De­spite bor­row­ers fo­cus­ing on re­pay­ing debt, cuts to fixed in­ter­est rates should main­tain some de­mand into next year. -PB News

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