Former executive denies he was at fault

LONDON/ZURICH: The former chief executive of UBS denied yesterday that he was at fault for failing to spot an “epic” interest rate scandal at the Swiss bank despite a former colleague admitting management negligence.

UBS was fined a record $1.5 billion (R12.9bn) last month for manipulating Libor interest rates, the latest in a string of scandals including a $2.3bn rogue-trading loss and a tax avoidance row with the US that have shredded the group’s once venerable reputation.

Marcel Rohner said he was “shocked” and “ashamed” when he read about the rigging of Libor interest rates, but said during his period as CEO he was trying to save the bank from collapse and was unaware of the misconduct.

Rohner was CEO for 20 turbulent months between 2007 and 2009, when UBS repeatedly had to tap shareholders for cash as it amassed more than $50bn in mortgage writedowns. He has not gone back to fulltime work since.

Rohner, along with three other former UBS executives, admitted to the committee that they first heard about the bank’s role in Libor manipulation in press reports in 2011 despite all four of them being in charge of the investment banking unit for part of the period when the rigging occurred.

Lawmakers blasted the four executives for “blissful ignorance”.

“I’m struggling to see how something of this scale and this central was off radar,” Susan Kramer, a member of the committee, said.

The British financial watchdog said interest rate rigging was so widespread at UBS that every submission it made over a six-year period from 2005 to 2010 inclusive was suspect. – Reuters