UBS AG, Switzerland’s largest bank with securities and investment banking operations in Connecticut, said today it expects a first quarter loss of nearly $1.75 billion and announced plans to cut 8,700 jobs worldwide by the end of next year.
The job cuts will hit the United States and Switzerland particularly hard because that is where the bank has its largest payrolls, a bank spokesman said.
Gruebel said the bank plans to cut 2,500 jobs in Switzerland, where more than one-third of the global staff is based.
Spokesman Serge Steiner gave no breakdown by country but said the impact on the U.S. employees would also be heavy because that is another major center of UBS operations. The bank says 38 percent of its employees are in the Western Hemisphere.
The areas to suffer the most cuts will be the so-called mid- and back offices — mostly support jobs without direct customer contact, said Steiner. Overall, UBS expects to cut its workforce to 67,500 in 2010 from 76,200 in 50 countries at the end of March.
The bank said clients have continued to withdraw their money from the bank in the wake of its decision to cooperate more closely with foreign authorities over tax evasion.
The company, which has been hard-hit by subprime-related losses, said it will “adapt its size to the changed market conditions and lower levels of business.” It said it expects cost savings of 3.5 to 4 billion francs by the end of 2010 compared to 2008 levels.
In prepared remarks for the annual shareholders meeting, new Chief Executive Oswald Gruebel said the bank knows where it has to set to work.
“It will be a long road back to success without any quick fixes,” said Gruebel. “Rather, we will move forward step by step in a rigorous and disciplined manner.”
Full first-quarter results and other details about the bank’s plans will be released May 5, it said. (AP)
