UBS board meets on investment bank's fate
SINGAPORE/LONDON (Reuters) - UBS <UBSN.VX> CEO Oswald Gruebel will on Friday attempt to convince his board the Swiss bank has a future in investment banking and can bounce back from a $2.3 billion crisis around rogue trading.
UBS, thrown into turmoil a week ago by the discovery that an alleged rogue trader, Kweku Adoboli, had taken a massive unauthorized position, has been locked in talks on whether the crisis will force it to quit or scale-back its investment banking operation.
At the least, it is expected to accelerate plans to streamline the business.
With his job on the line after the scandal, Gruebel will fight to maintain the investment bank as part of the group's business alongside wealth management, sources told Reuters on Thursday.
The 67-year-old German, a former bond trader himself, has been delivering "a consistent message" throughout the week, despite twin British and Swiss investigations into how Adoboli evaded UBS's compliance department, sources said.
Adoboli was "sorry beyond words" and "appalled at the scale of the consequences of his disastrous miscalculations," his lawyer said at a brief court appearance in London on Thursday.
The crisis has left Gruebel facing not only strategic issues, such as whether the bank should stick to its safer core wealth management business, but also concern about his management team and lax risk supervision.
UBS's board meeting, one of four regular meetings per year, coincides with the Singapore Formula One motor racing Grand Prix, of which UBS is a major sponsor.
(Editing by Jon Loades-Carter)