Union Bank of Switzerland (UBS) was a large integrated financial services company located in Switzerland.

The bank, which at the time was the second largest bank in Switzerland, merged with Swiss Bank Corporation in 1998, to become UBS to form what was then the largest bank in Europe and the second largest bank in the World. UBS, originally known as the Swiss Banking Association, was formed in 1912 through the merger of the Bank in Winterthur and Toggenburger Bank, both founded in the early 1860s. UBS then continued to grow through acquisitions, including Aargauische Kreditanstalt in 1919, Eidgenssische Bank in 1945, Interhandel Basel in 1967,Phillips & Drew in 1986, and Schroder, Munchmeyer, Hengst & Co. in 1997 among others. The historical UBS logo features a horizontal acronym "UBS" referring to the "Union Bank of Switzerland", "Union de Banques Suisses" or "Unione di Banche Svizzere". The vertical acronym "SBG" refers to the name of the bank in German "Schweizerische Bankgesellschaft". "UBS" ceased to be considered a representational abbreviation for the Union Bank of Switzerland after the bank's 1998 merger with Swiss Bank Corporation and is today considered a standalone brand.
Contents
[hide]

1 The company 2 History

o o o o o o o

2.1 Origins of the Union Bank of Switzerland 2.2 Activities in World War II 2.3 19451979 2.4 19801998 2.5 Merger with Swiss Bank Corporation 2.6 Long-Term Capital Management 2.7 Acquisition history

3 References

[edit]The

company

Prior to its merger with Swiss Bank Corporation, UBS operated as a full-service bank and a provider of wholesale financial services through its retail banking, commercial banking, investment banking, asset management and wealth management businesses. In 1997, prior to its merger with Swiss Bank Corporation, UBS operated 275 branches in Switzerland and 82 branches, subsidiaries and representative offices outside Switzerland. The company had approximately 27,611 employees, of which 19,355 worked in Switzerland and the remaining 8,256 employees were outside Switzerland.[1][2][3] The bank had total assets of nearly CHF578 billion and shareholders' equity of nearly CHF28 billion as of the end of 1997.[4] [edit]History

[edit]Origins

of the Union Bank of Switzerland

Bank in Winterthur, est. 1862

Toggenburger Bank, est. 1863

Main articles: Bank in Winterthur and Toggenburger Bank In 1862, The Bank in Winterthur was founded in Winterthur, Switzerland, with an initial share capital of CHF5 million.[2][5] The Bank in Winterthur operated primarily as a commercial bank, providing financing for a range of companies and projects. The bank would be involved in funding theSwiss Locomotive and Machine Works, the famous Hotel Baur au Lac in Zurich and many other companies.[2] The bank capitalized on its location at an important Swiss railroad junction and its large warehousing facilities allowed the bank to take advantage of the dramatic rise in cotton prices caused by the American Civil War. The Bank in Winterthur saw its share capital double by the end of the war. [6]

The bank's first offices in Zurich at Bahnhofstrasse 44 c. 1912.

Meanwhile, in 1863, the Toggenburger Bank was founded in Lichtensteig, Switzerland with an initial share capital of CHF1.5 million.[2] The Toggenburger Bank was a savings and mortgage bank for individual customers with a branch office network in Eastern Switzerland.[7] In 1882, Toggenburger Bank opened a branch in St. Gallen in eastern Switzerland and began to shift its operations there through the end of the 19th century. [2]

Announcement of the 1912 merger between Bank in Winterthur andToggenburger Bank to form Schweizerische Bankgesellschaft (Union Bank of Switzerland).

The Union Bank of Switzerland was formed in 1912 when the Bank in Winterthur merged with the Toggenburger Bank. The combined bank had total assets of CHF202 million and a total shareholders' equity of CHF46 million.[2] This combination was part of a larger trend toward concentration in the banking sector in Switzerland at the time. Through the next few years, the bank would begin to shift its operations to Zurich from its historical headquarters in the cities ofWinterthur and St. Gallen, Switzerland. In 1917, UBS completed construction of a new headquarters in Zurich on Bahnhofstrasse, considered to be the Wall Street of Switzerland.[5] The new bank used different names in its three core languages: German, French and English. In German, the bank was Schweizerische Bankgesellschaft and was known by the initials SBG. The original English name for the combined bank was the Swiss Banking Association, but it was later changed to Union Bank of Switzerland in 1921 to mirror the French form of the name: Union de Banques Suisses. The bank's logo, introduced in 1966, would later reflect both the German SBG and the English and French name UBS.[5]

In 1917, the newly merged Swiss Banking Association (later UBS) opened a new headquarters on Bahnhofstrasse(pictured above) in Zurich.

UBS acquired a number of banks in its first decade as a combined bank and expanded its branch network, establishing representation throughout Switzerland by 1923.[7] UBS acquired a controlling interest in Aargauische Creditanstalt in 1913 and Banque Ch. Masson & Cie. in 1916. Although the bank suffered during World War I and the postwar economic crises in Europe, UBS continued to make acquisitions after the conclusion of World War I. [7] The bank purchased the remaining stake in Aargauische Creditanstalt in 1919 that it had not acquired in 1913. Also in 1919, the bank acquired Commandit-AG Weibel & Cie. in Fleurier and William Cunod & Cie. In 1920, UBS acquired Banca Svizzera-Americana with branches in Locarno and Lugano; Unionbank Geneva and Banque Henry Rieckel & Cie., based in La Chaux-de-Fonds. Three years later, in 1923, UBS acquired the Schweizerische Vereinsbank in Bern establishing representation in the last of the major cities in Switzerland.[2]

The Union Bank of Switzerland logo ca. 1927. Until 1921, the bank was known as the Swiss Banking Association.[8]

Through the Great Depression, UBS pared its assets considerably shrinking from CHF993 million in 1929 to CHF441 million at the end of 1935. The bank saw its shareholders' capital decline from CHF100 million in 1929 to CHF80 million in 1933 and then further to CHF40 million by 1936.[2] However, the bank continued to acquire smaller, weaker competitors, purchasing Banca Unione di Credito in Lugano and Chiasso in 1935 followed by Berner Handelsbank in Bern in 1938. In 1937, UBS established Intrag AG, an asset management business responsible for investment trusts(i.e., mutual funds) and set up the "America-Canada Trust Fund AMCA". Over the years, Intrag would set up a series of other funds, including the "Mutual Fund for Swiss Stocks FONSA" and the "South Africa Trust Fund SAFIT".[2] The Bank in Winterthur and the Toggenburger Bank merge to form the Schweizerische Bankgesellschaft. Its French name is Union de Banques Suisses (UBS) and its Italian name is Unione di Banche Svizzere (UBS). The English name of the bank at first is Swiss Banking Association. In 1921 that somewhat inappropriate name is changed into Union Bank of Switzerland (UBS). The merged bank shows the following figures for 1912: Total assets: CHF202 million. Shareholders' Equity: CHF46 million. Profit: CHF2.4 million.

Dr. Rudolf Ernst (18651956) First Chairman of the Board of Directors of the merged bank from 1912 until 1941 is Rudolf Ernst, of Winterthur, until 1921 alternating with C. Emil Grob-Halter of Lichtensteig. After the merger of the Bank in Winterthur and the Toggenburger Bank to form Union Bank of Switzerland (UBS), Dr. Rudolf Ernst became the merged bank's first chairman in 1912. Following his resignation in 1941, he was elected as an Honorary chairman of Union Bank of Switzerland. Rudolf Ernst joined the Bank in Winterthur in 1895. He was also financial director of the City of Winterthur for 16 years. At the young age of 36, he was elected in 1901 to the Board of Directors of the Bank in Winterthur and as its chairman at the same time. During his chairmanship, the bank changed its focus from its original lending business and began to expand its issuing and asset management franchise. With the acquisition of the Bank in Baden in 1906, the bank gained a branch in Zurich and a seat on the stock exchange, one of the cornerstones for the successful merger in 1912 with the Toggenburger Bank to form Union Bank of Switzerland. Rudolf Ernst also held directorships on the boards of various industrial and insurance companies. Between 1912 and his retirement in 1941, he was chairman of the Board of Union Bank of Switzerland, in an alternating capacity with Carl Emil Grob-Halter, who held the chairmanship in 1916 and 1918 as the representative of the merger partner Toggenburger Bank. [edit]Activities

in World War II

On the eve of World War II, UBS was the recipient of a large influx of foreign funds for safekeeping. During the war, the bank's traditional business fell off and the Swiss government became their largest clients. [5] Still, unlike many of its peers, UBS's business lagged through much of the war. [5]

UBS "Gold Key" used to access an account number known only to the bearer.

Decades after the war, it was demonstrated that Union Bank of Switzerland likely took active roles in trading stolen gold, securities and other assets during World War II. [9][10][11] The issue of "unclaimed property" of Holocaust victims became a major issue for UBS in the mid-1990s and a series of revelations in 1997 brought the issue to the forefront of national attention in 1996 and 1997.[12] UBS confirmed that a large number of accounts that had gone unclaimed as a result of the bank's policy of requiring death certificates from family members to claim the contents of the account. [13][14] UBS's handling of these revelations were largely criticized and the bank received significant negative attention in the U.S. [15][16] UBS came under significant pressure, particularly from American politicians, to compensate Holocaust survivors who were making claims against the bank.[17]

Christoph Meili's disclosure of UBS Nazi-era documents in 1997 caused an international controversy that resulted in a US$1.25 billion settlement with Holocaust survivors seeking "unclaimed property" from World War II.

In January 1997, Christoph Meili, a night watchman at the Union Bank of Switzerland, found employees shredding archives compiled by a subsidiary that had extensive dealings with Nazi Germany. The shredding was in direct violation of a recent Swiss law adopted in December 1996 protecting such material. UBS acknowledged that it had "made a deplorable mistake", but an internal historian maintained that the destroyed archives were unrelated to the Holocaust.[18] Criminal proceedings then began against the archivist for possible violation of a recent Federal Document Destruction decree and against Meili for

possible violation of bank secrecy, which is a criminal offence in Switzerland. Both proceedings were discontinued by the District Attorney in September 1997.[19] Meili was suspended from his job at the security company that served UBS, following a criminal investigation. [20] Meili and his family left Switzerland for the United States where they were grantedpolitical asylum.[21][22][23] By contrast, in the U.S., Meili was largely regarded as a hero andwhistleblower and received a particularly warm reception from the American Jewish community.[24] In 1997, the World Jewish Congress lawsuit against Swiss banks (WJC) was launched to retrieve deposits made by victims of Nazi persecution during and prior to World War II. Negotiations involving Union Bank of Switzerland, Credit Suisse, the WJC and Stuart Eizenstat, on behalf of the U.S., ultimately resulted in a settlement of US$1.25 billion in August 1998.[9][25][26] The settlement, which coincided with UBS's merger with Swiss Bank, together with the bank's embarrassment in the Long Term Capital Management collapse in 1998 brought a degree of closure to the issue. [27][28][29] [edit]19451979 Shortly after the end of World War II, UBS completed the acquisition of Eidgenssische Bank, a large Zurich-based bank that became insolvent. As a result of the merger, UBS exceeded CHF1 billion of assets for the first time and completed the transition of its operations to Zurich. Although UBS opened an office in New York in 1946, the bank remained primarily focused on its domestic business.[5] Prior to the end of World War II, the Swiss banking landscape was dominated by Swiss Bank Corporation and Credit Suisse. UBS was among the next group of large banks that included Schweizerische Volksbank (Swiss Volksbank or Swiss Popular Bank) and Bank Leu. Throughout the 1950s and 1960s, the Union Bank of Switzerland, which was at best the third largest bank in Switzerland would catch up to its larger peers and by the 1970s surpass them in terms of size.[30] UBS opened branches and acquired a series of banks in Switzerland growing from 31 offices in 1950 to 81 offices by the beginning of the 1960s. Throughout the 1950s, UBS was the most acquisitive bank in Switzerland, acquiring Banque Palzieux & Cie. (1948), Volksbank Interlaken (1952), Weck, Aebi & Cie (1954), Banque Tissires fils & Cie. (1956), Banque de Sion (1956), Banque de Brigue (1957), the Crdit Gruyrien (1957), Crdit Sierrois (1957), Bank Cantrade AG (1960) and Volksbank in Visp (1960).[2] In addition to these bank acquisitions, UBS also acquired an 80% stake in Argor SA, a Swiss precious metal refinery founded in 1951, through whom they started to issue UBS branded gold bars. In 1973, the bank increased the stake to full 100% ownership only to withdraw by 1999 with ownership of the refinery changing to Hereaus & Management. Nevertheless, UBS continues to issue gold bars via Argor-Heraeus which is famous for the unique kinebar holographic technology it uses to provide enhanced protection against bank gold bar counterfeiting. [31]

The Union Bank of Switzerland logo ca. 1960, an early incarnation of its logo featuring crossing UBS and SBG acronyms. Later versions would have the English and French "UBS" running horizontally and the German SBG running vertically.

By 1962, UBS reached CHF6.96 billion of assets, narrowly edging ahead of Swiss Bank Corporation to become the largest bank in Switzerland temporarily. Through 1979, SBC was consistently the largest of the three major Swiss banks by assets, except for short periods in 1962 and then again in 1968 when UBS temporarily moved ahead of SBC. After 1979, UBS would firmly establish itself as the largest Swiss bank. [7] UBS would retain this position for the next 15 years until Credit Suisse leapfrogged into the top spot following its 1993 acquisition of Schweizerische Volksbank (Swiss Volksbank) and later Winterthur Group.[2][32] UBS continued its rapid growth in the 1960s punctuated by the acquisition of Interhandel(Industrie- und Handelsbeteiligungen AG) in 1967. Interhandel, originally, was a large Swiss conglomerate that up until the 1960s had both financial as well as industrial holdings. Interhandel was the corporate successor of I.G. Chemie, which the U.S. government had claimed was a front for Germany's I.G. Farben during World War II. [33] During the war, the U.S. government seized General Aniline & Film (later GAF Corporation), an Interhandel subsidiary, and it was not until 1963 that the longrunning dispute between Interhandel and the U.S. government was resolved. [34] The shares in GAF Corporation were sold in a highly competitive auction in 1965 and the proceeds were split between Interhandel and the U.S. government. [35] As a result of the sale of GAF, at the time of its merger with UBS, Interhandel held substantial amounts of cash. The addition of the Interhandel capital, which propelled UBS into the top spot among Swiss banks in 1968, also made UBS one of the strongest banks in Europe and helped fuel the banks further expansion in the late 1960s and 1970s. [7] UBS consolidated four affiliated mortgage lenders and assumed their domestic retail operations. The bank further expanded into consumer lending through the acquisition of a series of Swiss financial businesses in 1969, including Banque Orca, Abri Bank Bern, Aufina Bank and AKO Bank.[2] UBS also began to intensify its overseas expansion. In 1967, UBS opened a full branch office in London, its first such office outside Switzerland. Prior to this, UBS had operated through a series of correspondent banks and representative offices. Three years later, UBS opened a branch office in New York. The bank also established a UK subsidiary in 1975 and a U.S. subsidiary in 1979 to focus on building the banks presence in the underwriting of debt and equity securities.[7] Nevertheless, UBS, which had traditionally concentrated its efforts on the domestic Swiss market, was the last of the three largest Swiss

banks to establish a branch office in the U.S. and its securities operations were overshadowed by those of its two Swiss peers.[5] [edit]19801998 By the 1980s, the bank had undertaken a major push into the securities business internationally. The bank established a position as a leading European underwriter of Eurobonds and pulled off a major coup in 1985 by pricing a large bond offering for Nestl, Rockwell, IBM, and Mobil at below market rates. [5]

UBS's primary offices in the U.S., prior to its merger with SBC were located at 299 Park Avenue in New York, which are used today as the New York headquarters of UBS Investment Bank.

The bank also made two major acquisitions in 1986, first it purchased Phillips & Drew an established British brokerage and asset management firm, founded in 1895. However, UBS initially had issues integrating Phillips & Drew. The firm lost 15 million when a rush of orders overwhelmed the firms settlement system in 1987. Then the bank lost 48 million as a result of Philips & Drew positions in the October 1987 stock market crash. Between April 1987 and February 1988, UBS was required to spend as much as 115 million to shore up Phillips & Drew.[5] Phillips & Drew unit returned to profitability in 1992 after years of losses.[36] UBS also expanded into West Germany, acquiring Deutsche Lnderbank in 1986. In 1991, UBS made its first acquisition in the United States, purchasing Chase Investors Management Corporation, the asset management business of Chase Manhattan Bank. Chase Investors, which was established in 1972, was subsequently folded into UBS Asset Management after the acquisition. At the time of the acquisition, which resulted in approximately US$100 million for Chase, the business managed in excess of US$30 billion in public and private pension plans, as well as various financial assets of corporations, governments, foundations and endowments. [37] UBS also entered the life insurance business in 1993 establishing UBS Life. UBS formed a joint venture with Swiss Life in 1995, known as UBS Swiss Life. UBS took a 25% ownership position in Swiss Life in exchange for a 50% share in the joint venture.[38]

UBS entered the 1990s clearly the largest and most conservative of the three large Swiss Banks. Unlike Swiss Bank and Credit Suisse, which had both made aggressive international acquisitions in trading and investment banking, UBSs investments had been more conservative in businesses such as asset management and life insurance while 60% of the bank's profits came from its even more conservative Swiss banking operations. [36] In 1993, Credit Suisse outbid UBS for Switzerland's Swiss Volksbank, the fifth largest bank in Switzerland which had run into financial difficulties in the early 1990s.[32] The acquisition propelled Credit Suisse ahead of UBS as the largest bank in Switzerland for the first time. UBS instead settled on a group of less audacious acquisitions, purchasing a group of smaller banks in Switzerland in 1994 and then acquiring the Cantonal Bank of Appenzell-Ausserrhoden in 1996.[2] In its final acquisition, prior to the merger with Swiss Bank Corporation, the bank acquired Schroder, Munchmeyer, Hengst & Co. fromLloyds Bank in 1997 in order to further penetrate the German investment banking market as well as the market for wealthy private clients.[39] Schroder Munchmeyer Hengst was formed through the 1969 merger of three German banks: Schroeder Brothers & Co., Muenchmeyer & Co. and Frederick Hengst & Co. (formerly known as Bank Siegmund Merzbach).[39] [edit]Merger

with Swiss Bank Corporation

The combined UBS logo incorporated UBS's name with SBC's "three keys" symbol.

Main articles: Swiss Bank Corporation and UBS During the mid-1990s, UBS came under fire from dissident shareholders, critical of bank's relatively conservative management and lower return on equity.[40] Martin Ebner, through his investment trust, BK Vision became the largest shareholder in UBS and attempted to force a major restructuring of the banks operations. [41] The battles between Ebner and UBS management proved a distraction to the bank in the mid-1990s. Looking to take advantage of the situation, Credit Suisse approached UBS about a merger that would have created the second largest bank in the world in 1996. [42] UBS's management and board unanimously rebuffed the proposed merger. [43] Ebner, who supported the idea of a merger, led a major shareholder revolt that resulted in the replacement of UBS's chairman, Robert Studer. [44] Studer's successor Mathis Cabiallavetta would be one of the key architects of the merger withSwiss Bank Corporation.[5]

The Union Bank of Switzerland's principal office at Bahnhofstrasse 45 in Zurich served as the headquarters for the combined bank.

On 8 December 1997, Union Bank of Switzerland and Swiss Bank Corporationannounced an all stock merger. At the time of the merger, Union Bank of Switzerland and Swiss Bank Corporation were the second and third largest banks in Switzerland, respectively both trailing Credit Suisse.[30] Discussions between the two banks had begun several months earlier, less than a year after rebuffing Credit Suisse's merger overtures.[45] The all-stock merger resulted in the creation UBS AG, a huge new bank with total assets of more than US$590 billion.[46] Also referred to as the "New UBS" to distinguish itself from the former Union Bank of Switzerland, the combined bank became the second largest in the world, at that time, behind only the Bank of TokyoMitsubishi.[46] Additionally, the merger pulled together the banks' various asset management businesses to create the world's largest money manager, with approximately US$910 billion in assets under management.[46] The merger, which was billed as a merger of equals, resulted in UBS's shareholders receiving 60% of the combined company and Swiss Bank's shareholders receiving the remaining 40% of the bank's common shares. UBS's Mathis Cabiallavetta became chairman of the new bank while Swiss Bank's Marcel Ospel was named chief executive officer.[46] However, it quickly became evident that from a management perspective, it was Swiss Bank that was buying UBS as nearly 80% of the top management positions were filled by legacy Swiss Bank professionals. [5] Additionally, UBS professionals suffered more headcount reductions, particularly in the investment banking unit where there were heavy cuts in the corporate finance and equities businesses.[47][48] The more severe cuts at UBS were an acknowledgment that prior to the merger Swiss Bank Corporation had built a global investment banking business, Warburg Dillon Read through its acquisitions of Dillon Read in New York and S.G. Warburg in London. Swiss Bank was generally considered to be further along than UBS in developing its international investment banking business, particularly in the higher margin advisory businesses where Warburg Dillon Read was considered to be the more established platform. [49][50] UBS, on the other hand had a stronger retail and commercial banking business in Switzerland and both banks had notably strong asset management capabilities.[46] After the merger was completed, it was widely speculated that a series of losses suffered by UBS on its equity derivative positions in late 1997 was a contributing factor in pushing UBS management to consummate the merger. [51][52] It

would become clear that the derivatives losses prompted UBS to accept the terms proposed by Swiss Bank more readily than they otherwise would have. [53] [edit]Long-Term

Capital Management

Main article: Long-Term Capital Management Union Bank of Switzerland, suffering criticism of its conservative business model, was looking for ways to catch up to its key Swiss rivals and viewed LTCM as the type of client that could help accelerate the bank's growth. In 1997, UBS entered into a financing arrangement with LTCM and the hedge fund quickly became the bank's largest client, generating US$15 million in fees for UBS.[54]Union Bank of Switzerland sold LTCM a 7-year European call option on 1 million shares in LTCM, then valued at about US$800 million. It hedged this option by purchasing a US$800 million interest in LTCM and invested a further US$300 million in the hedge fund.[55]Following the merger, Swiss Bank managers were surprised to discover the massive exposure to LTCM at UBS.[54] Ultimately, UBS was unable to sell or hedge its interest in LTCM as its value declined in the summer of 1998. By November 1998, UBS's losses from its exposure to LTCM were estimated at approximately CHF790 million.[56] UBS would prove to be the largest single loser in the LTCM collapse, ultimately writing off CHF950 million.[5] The Federal Reserve Bank of New Yorkorganized a bailout of US$3.625 billion by the hedge fund's major creditors to avoid a wider collapse in the financial markets.[57] UBS contributed US$300 million to the bailout effort, which would largely be recovered. [58] In the aftermath of the LTCM collapse, Mathis Cabiallavetta resigned as chairman of UBS along with three other executives. [59] [edit]Acquisition

history

Union Bank of Switzerland, prior to its merger with Swiss Bank Corporation was the result of the combination of dozens of individual firms, many of which date to the 19th century. The following is an illustration of the company's major mergers and acquisitions and historical predecessors, although this is not necessarily a comprehensive list: [60]
Union Bank of Switzerland
(originally Swiss Banking Association, merged 1912)

Bank in Winterthur
(est. 1862)

Union Bank of Switzerland

Toggenburger Bank
(est. 1863)

Aargauische Kreditanstalt
(merged 1915, acq. 1919)

Aargauische Kreditanstalt
(est. 1872)

Bank in Baden
(est. 1863)

Eidgenssische Bank
(est. 1863, acq. 1945)

(est. 1928, acq. 1967)

Phillips & Drew

(est. 1895 as G.A. Phillips & Co., acq. 1986)

Chase Investors Management Corporation

(est. 1972 as subsidiary of Chase Manhattan Bank, acq. 1991)

Schroder, Munchmeyer, Hengst & Co.

(merged 1969, acq. 1997)

Schrder Brothers & Co.

(est. 1846)

Mnchmeyer & Co.

(est. 1855)

Frederick Hengst & Co.

[edit]References
Switzerland portal Companies portal

Wikimedia Commons has media related to: Union Bank of Switzerland

1. 2. 3. 4. 5. 6. 7. 8. 9.

^ a b c UBS Portrait (January 1997 Archived company website) Retrieved 11 August 2010. ^ a b c d e f g h i j k l m UBS History. Company website. ^ UBS 1995 Annual Report (January 1997 Archived company website) Retrieved 11 August 2010. ^ UBS AG Annual Financial Report 1998. ^ a b c d e f g h i j k l UBS AG. Funding Universe, Retrieved 10 August 2010. ^ Swiss banking: an analytical history. Palgrave Macmillan, 1998 (p. 132-136). ^ a b c d e f Handbook on the History of European Banks. Edward Elgar Publishing, 1994. ^ Bankers Magazine December 1920, p. 794. ^ a b Swiss Were Part of Nazi Economic Lifeline, Historians Find. New York Times, 2 December 2001.

10. ^ Switzerland: A Painful History. TIME, 24 February 1997. 11. ^ Breaking The Swiss Banking Silence. New York Times, 4 June 1996. 12. ^ Swiss Envoy in U.S. in Midst of a Squall. New York Times, 20 January 1997.

13. ^ Ulrich Jost, Swiss historian : Bank Secrecy Was Bern's Wartime 'Weapon'. New York Times, 1 August 1997. 14. ^ Probe lays bare Swiss wartime role, SwissInfo.ch, 22 March 2002. 15. ^ How Swiss Strategy on Holocaust Fund Unraveled. New York Times, 26 January 1997. 16. ^ More Blundering by Swiss Banks. New York Times, 3 August 1997. 17. ^ New York Punishes Swiss Bank Over Nazi Gold. New York Times, 10 October 1997. 18. ^ The Rescuer of Swiss Bank Ledgers. New York Times, 17 January 1997. 19. ^ Parliament of Canton of Zurich: Protocol of the session of Monday, April 20, 1998 (Word document). URL last accessed 2006-10-30. 20. ^ "Bank Says Shredded Papers May Not Have Involved Nazis, New York Times, 16 January 1997". Retrieved 22 April 2007.

Board of Directors
The Board of Directors (BoD) has ultimate responsibility for the success of the UBS Group and for delivering sustainable shareholder value within a framework of prudent and effective controls. It decides on UBSs strategic aims and the necessary financial and human resources upon recommendation of the Group Chief Executive Officer and sets the UBS Groups values and standards to ensure that its obligations to its shareholders and others are met.

Shareholders elect each member of the BoD, which in turn appoints its Chairman, the Vice Chairman/Vice Chairmen, the Senior Independent Director and the chairmen and members of its various committees.

Axel A. Weber

Axel A. Weber was elected to the Board of Directors (BoD) at the 2012 Annual General Meeting (AGM) and was thereafter appointed Chairman ofthe BoD. He chairs the Governance and Nominating Committee and has been a member of the Corporate Responsibility Committee since 2012. CV

Michel Demar

Michel Demar was elected to the BoD at the 2009 AGM, and in April 2010 was appointed independent Vice Chairman. He has been a member of the Audit Committee since 2009 and the Governance and Nominating Committee since 2010. CV

David Sidwell

David Sidwell was elected to the BoD at the 2008 AGM. In April 2010, he was appointed Senior Independent Director. He has chaired the Risk Committee since 2008 and has been a member of the Governance and Nominating Committee since 2011. CV

Rainer-Marc Frey

Rainer-Marc Frey was elected to the BoD at the October 2008 Extraordinary General Meeting and has been a member of the Risk Committee since 2008 and the Human Resources and Compensation Committee since 2012. CV

Ann F. Godbehere

Ann F. Godbehere was elected to the BoD at the 2009 AGM. She has chaired the Human Resources and Compensation Committee since 2011 and has been a member of the Audit Committee since 2009. CV

Axel P. Lehmann

Axel P. Lehmann was elected to the BoD at the 2009 AGM and has been a member of the Governance and Nominating Committee since 2011 and the Risk Committee since 2009. CV

Wolfgang Mayrhuber

Wolfgang Mayrhuber was elected to the BoD at the 2010 AGM. He has chaired the Corporate Responsibility Committee since 2011 and has been a member of the Human Resources and Compensation Committee since 2010. CV

Helmut Panke

Helmut Panke was elected to the BoD at the 2004 AGM. He has been a member of the Human Resources and Compensation Committee and the Risk Committee since 2008. CV

William G. Parrett

William G. Parrett was elected to the BoD at the October 2008 Extraordinary General Meeting. He has chaired the Audit Committee since 2009 and has been a member of the Corporate Responsibility Committee since 2012. CV

Isabelle Romy

Isabelle Romy was elected to the BoD at the 2012 AGM. She has been a member of the Audit Committee and the Governance and Nominating Committee since 2012. CV

Beatrice Weder di Mauro

Beatrice Weder di Mauro was elected to the BoD at the 2012 AGM. She has been a member of the Audit Committee and Corporate Responsibility Committee since 2012. CV

Joseph Yam

Joseph Yam was elected to the BoD at the 2011 AGM. He has been a member of the Corporate Responsibility Committee and the Risk Committee since 2011. CV

Company Secretary

Luzius Cameron

Luzius Cameron was appointed Company Secretary by the BoD in 2005. He is a Group Managing Director and was appointed to the former Group Managing Board in 2002. CV

UBS AG (SIX: UBSN, NYSE: UBS) is a Swiss global financial services company headquartered in Basel and Zrich, Switzerland. It provides investment banking, asset management, and wealth management services for private, corporate, and institutional clients worldwide, as well as retail clients in Switzerland. The name "UBS" was originally an abbreviation for the Union Bank of Switzerland, but it ceased to be a representational abbreviation after the bank's 1998 merger with Swiss Bank Corporation.[2] The company traces its origins to 1854, when the earliest of its predecessor banks was founded. UBS operates in more than 50 countries and has about 65,000 employees globally as of 2012. [3] It is considered the world's second largest manager of private wealth assets, with over CHF2.2 trillion in invested assets,[4][5] a leading provider of retail banking andcommercial banking services in Switzerland. UBS suffered among the largest losses of any European bank during the subprime mortgage crisis and the bank was required to raise large amounts of outside capital. In 2007, the bank received a large capital injection from the Government of Singapore Investment Corporation, which remains the bank's largest shareholder. [6][7] The bank also received capital from the Swiss government[8] and through a series of equity offerings in 2007, 2008 and 2009.
Contents
[hide]

1 Corporate structure

o o o o o

1.1 UBS Investment Bank 1.2 UBS Global Asset Management 1.3 UBS Wealth Management 1.4 UBS Swiss Bank 1.5 Competition

2 History

2.1 Swiss Bank Corporation

2.1.1 Origins and early years (18541945) 2.1.2 Post-war years (19451998)

2.2 Union Bank of Switzerland

 o o o o o o o o o

2.2.1 Origins and early years (18621945) 2.2.2 Activities in World War II 2.2.3 Post-war years (19451998)

2.3 Merger of Union Bank of Switzerland and Swiss Bank Corporation 2.4 Long Term Capital Management 2.5 Rising in the league tables (20002007) 2.6 The Subprime mortgage crisis (2007) 2.7 Impact of the financial crisis (20082009) 2.8 U.S. tax evasion controversy 2.9 Re-establishment (2009current) 2.10 2011 rogue trader scandal 2.11 Acquisition history

3 Management

o o

3.1 Board of Directors 3.2 Group Executive Board

4 Legal controversies 5 Corporate social responsibility 6 Recognition 7 Sponsorship

o o

7.1 Sport 7.2 Culture

8 References 9 External links

[edit]Corporate

structure

UBS is a joint-stock company according to Swiss law, headquartered in Basel and Zrich, Switzerland, and is listed at the SIX Swiss Exchange and the New York Stock Exchange (NYSE). UBS is present in all major financial centers worldwide, with about 37% of its 64,617 employees working in the Americas, 37% in Switzerland, 16% in the rest of Europe and 10% in Asia Pacific.[5] It has a major presence in the United States, with its American headquarters located in New York City (Investment banking); Weehawken, New Jersey(Private Wealth Management); and Stamford, Connecticut (Sales & Trading). UBS's global business groups are wealth management,investment banking and asset management. Additionally, UBS is the leading provider of retail banking and commercial banking services in Switzerland, as of 2009. Overall invested assets are CHF3.265 trillion, shareholders' equity is CHF47.850 billion and market capitalization is CHF151.2 billion by the end of 2Q 2007.

UBS is structured in three client divisions: Investment Banking, Global Asset Management, and Wealth Management. On June 9, 2003, all UBS business groups, including UBS Paine Webber and UBS Warburg, rebranded under the UBS name as the company began operating as a unified global entity.[9] [edit]UBS

Investment Bank

UBS Investment Bank's New York offices at299 Park Avenue

UBS Investment Bank, a bulge bracket bank, provides securities, other financial products, and research in equities, fixed income, rates, foreign exchange, precious metals and derivatives. Its 15,000 people across over 30 countries[10] also advise and provide access to capital markets for corporate and institutional clients, governments, financial intermediaries, alternative asset managers and private investors.[11] UBS Investment Bank was formerly known as UBS Warburg and as Warburg Dillon Read, before the merger of Union Bank of Switzerland and Swiss Bank Corporation (SBC). Within the UBS Investment Bank, the Investment Banking Department (IBD) provides a range of advisory and underwriting services including mergers and acquisitions,restructuring, equity offerings, investment grade and high yield debt offerings, leveraged finance and leveraged loan structuring, and the private placement of equity, debt, andderivatives. The Sales & Trading division, comprises Equities (brokering, dealing, market makingand engaging in proprietary trading in equities, equity-related products, equity derivatives, and structured products) and Fixed Income, Currencies, and Commodities (FICC) (brokering, dealing, market making and engaging in proprietary trading in interest rate products, credit products, mortgage-backed securities, leveraged loans, investment grade and high yield debt, currencies, commodities, structured products and derivative products).

UBS Investment Bank's offices in Stamford, Connecticut. At roughly the size of two American football fields it is the largest trading floor in the world. Following an expansion in 2002, the trading floor covers 103,000-square-foot (9,600 m ) with 40-foot (12 m) arched ceilings. Over US$1 trillion in assets are traded here every trading day. In June 2011, it was announced that UBS was considering moving its North American headquarters back to New York City, and that the bank was looking at office space in Midtown and in the rebuilt World Trade Center
[12] 2

[13]

Since the early 2000s, UBS Investment Bank has been among the top fee-generating investment banks globally.[14] For 2010 UBS ranked No.5 globally in mergers & acquisitions advisory, No.5 globally in debt capital markets bookrunning, No.5 globally in follow-on equity offerings, No.3 in European follow-on equity offerings, No.1 in Asia M&A advisory, No.2 in Asian equity capital markets bookrunning, No.2 in Asian follow-on equity offerings, No.2 in Canadian M&A advisory, No.3 in Middle Eastern & African mergers & acquisitions advisory, and No.2 in Middle Eastern & African equity capital markets bookrunning.[15] UBS also ranked No.1 on the 2010 M&A league tables in Australia, ahead of Macquarie Bank and Goldman Sachs.[16][17] [edit]UBS

Global Asset Management

UBS Global Asset Management offers investment products in equities, fixed income, global diversified portfolios, alternative investments, quantitative investments, real estate, infrastructure and funds of funds for private clients, financial intermediaries,institutional investors and itself via proprietary trading.[18] The 1998 UBS-SBC merger and subsequent restructuring resulted in the combination of three major asset management operations: UBS Asset Management, Phillips & Drew (owned by Union Bank of Switzerland) and Brinson Partners (owned by SBC). The investment teams were merged in 2000 and in 2002 the brands were consolidated as UBS Global Asset Management.[19] As of 2010, UBS Asset Management was responsible for more than CHF569 billion of invested assets. With over 3,500 employees in 25 countries, UBS Global Asset Management is the largest mutual fund manager in Switzerland and the largest fund of hedge fundsmanager in the world. UBS Global Asset Management has major offices in London, Chicago, Frankfurt, Hartford, Hong Kong, New York, Paris, Singapore, Sydney, Tokyo, Toronto and Zurich. [edit]UBS

Wealth Management

UBS's wealth management division offers high net worth individuals a range of advisory and investment products and services. UBS offers brokerage services and products as well as asset management and other investment advisory and portfolio management products and services. Additionally, UBS provides a broad range of securities and savings products that are supported by the firm's underwritingand research activities as well as order execution and clearing services for transactions originated by individual investors. Until 2009, UBS was considered the largest wealth manager globally. The business is further divided geographically with separate businesses focused on the U.S. and other international markets. UBS Wealth Management in the U.S. is an outgrowth of the former Paine Webber brokerage business. The

business changed its name first to UBS Paine Webber in March 2001 after it was acquired by UBS. The subsidiary further changed its name to UBS Wealth Management USA in June 2003. UBS Wealth Management employs more than 27,500 personnel in 44 countries. In the United States, UBS Wealth Management employs more than 8,000 financial advisors. UBS also offers traditional Swiss bank services to its non-U.S. clients. [edit]UBS

Swiss Bank

In Switzerland, UBS Swiss Bank provides a complete set of retail banking services that include checking, savings, credit card andmortgage products for individuals and cash management and commercial banking services for small businesses and corporate clients. [edit]Competition On a global scale, UBS competes with the large global investment banks, though it is regularly compared against its fellow Swiss banking giant, Credit Suisse. In Switzerland, UBS competes with a number of cantonal banks such as Zrcher Kantonalbank and Kantonalbank as well as Raiffeisen, PostFinance and Migros Bank. [edit]History Further information: Swiss Bank Corporation and Union Bank of Switzerland UBS, as it exists today, is the result of the merger of the Union Bank of Switzerland[20] and the Swiss Bank Corporation[21] (SBC) in June 1998. Although the merged company's new name was originally supposed to be the "United Bank of Switzerland," officials opted to call it simply "UBS" because of a name clash with United Bank Switzerland - a part of the United Bank Limited's Swiss subsidiary. UBS is no longer an acronym but is the company's brand. Its logo of three keys, carried over from SBC, stands for confidence, security and discretion. [22] Yet UBS also comprises a number of well-known securities firms that have been acquired by the bank and its predecessors. Among the bank's most notable constituent parts are Paine Webber,[23] Dillon, Read & Co., Kidder, Peabody & Co.,Phillips & Drew, S. G. Warburg & Co., Blyth, Eastman Dillon & Co., Jackson & Curtis and Union Securities among others.[24] [edit]Swiss

Bank Corporation

[edit]Origins and early years (18541945)

Swiss Bank Corporation logo (ca. 1973), featuring the three keys meant to symbolize confidence, security and discretion.

UBS, through Swiss Bank Corporation, traces its history to 1854 when six private banking firms in Basel, Switzerland pooled their resources to form the Bankverein, a consortium that acted as an underwriting syndicate for its member banks. [24] In 1871, the Bankverein coordinated with the German Frankfurter Bankverein to form the Basler Bankverein, a joint-

stock company replacing the original Bankverein consortium. After the new bank started with an initial commitment of CHF30 million and CHF6 million of share capital, it soon experienced growing pains when heavy losses in Germany caused it to suspend its dividend until 1879. Following the years 1885 and 1886, when the bank merged with the Zrcher Bankverein and acquired the Basler Depositenbank and the Schweizerische Unionbank, it changed its name to Schweizerischer Bankverein (SBC).[24]The English name of the bank was changed to Swiss Bank Corporation in 1917.[20]

The Basel, Switzerland offices of Swiss Bank Corporation c.1920

[25]

1872 Basler Bankverein investor prospectus

SBC subsequently experienced a period of growth, which was only interrupted by the onset of World War I, in which the bank lost investments in a number of large industrial companies. By the end of 1918, the bank had recovered and surpassed CHF1 billion in total assets, and grew to 2,000 employees by 1920. The impact of the stock market crash of 1929 and the Great Depression would be severe, particularly as the Swiss franc suffered major devaluation in 1936. The bank would see its assets fall from a 1929 peak of CHF1.6 billion to its 1918 levels of CHF1 billion by 1936.[20][24] In 1937, SBC adopted its three-keys logo, designed by Warja Honegger-Lavater, symbolizing confidence, security and discretion, and which remains an integral part in the current-day logo of UBS. On the eve of World War II, SBC, like other Swiss banks, was the recipient of large influxes of foreign funds for safekeeping. In 1939, just prior to the outbreak of the war, SBC made the timely decision to open an office in New York City.[26] The office, located in theEquitable Building, was able to begin operations a few weeks after the outbreak of the war and was intended as a safe place to store assets in the case of an invasion. [27] During the war, the banks' traditional business fell off and the Swiss government became their largest clients. [20] [edit]Post-war years (19451998) In 1945, SBC acquired the Basler Handelsbank (Commercial Bank of Basel), which was one of the largest banks in Switzerland but got insolvent by the end of the war. SBC remained among the Swiss government's leading underwriters of debt in the post-war years. SBC, which had entered the 1950s with 31 Branch Offices in Switzerland and three abroad, more than doubled its assets from the end of the war to CHF4 billion by the end of the 1950s and doubled assets again by the mid-1960s, exceeding CHF10 billion in 1965.[24] In 1961, SBC acquired Banque Populaire Valaisanne, Sion, Switzerland and the Banque Populaire de Sierre.[28] The bank opened a full branch office in Tokyo in 1970.[24]

Former Swiss Bank Tower off of Fifth Avenue, New York City, opened in 1990.

In 1992 SBC acquired O'Connor & Associates, a Chicago-based options trading firm and the largestmarket maker in the financial options exchanges in the U.S. [29] O'Connor was combined with SBC'smoney market, capital market and currency market activities to form a globally integrated capital markets and treasury operation. [29] In 1994, SBC acquired Brinson Partners, an asset management firm focused on providing access for U.S. institutions to global markets, for US$750 million.[21] Following the acquisition, founder Gary Brinson ran SBC's asset management business and later when SBC merged with UBS was named chief investment officer of UBS Global Asset Management.[30] The acquisition of S.G. Warburg & Co., a leading British investment banking firm, in 1995 for the price of US$1.4 billion signified a major push into investment banking. S.G. Warburg had established a reputation as a daring merchant bank that grew to be one of the most respected investment banks in London. [31]However, an expansion into the U.S. had turned out flawed and costly, and talks in 1994 with Morgan Stanley about a merger had collapsed.[32] SBC merged the firm with its own existing investment banking unit to create SBC Warburg.[21][33]

Warburg Dillon Read (originally SBC-Warburg Dillon Read) was the brand used for the Investment Banking division of Swiss Bank Corporation and later UBS from 1997 to 1999.

Two years later, in 1997, SBC paid US$600 million to acquire Dillon, Read & Co., a U.S.bulge bracket investment bank.[34][35] Dillon, Read, which traced its roots to the 1830s was among the powerhouse firms on Wall Street in the 1920s and 1930s and by the 1990s had a particularly strong mergers and acquisitions advisory group. Dillon Read had been in negotiations to sell itself to ING, which owned 25% of the firm already, but Dillon Read partners balked at ING's integration plans.[34] After its acquisition by SBC, Dillon Read was merged with SBC-Warburg to create SBC-Warburg Dillon Read. Following SBC's later merger with Union Bank of Switzerland, the SBC part was dropped from the name, and in 2000 when the new UBS got restructured the Dillon Read name was dropped, although it was brought back in 2005 as Dillon Read Capital Management, UBS's ill-fated hedge fund operations.

[edit]Union

Bank of Switzerland

[edit]Origins and early years (18621945)

Union Bank of Switzerland logo of 1966, featuring the two acronyms of its English and French names (UBS) and its German counterpart (SBG).

The Union Bank of Switzerland emerged in 1912 when the Bank in Winterthur fused with the Toggenburger Bank. The Bank in Winterthur, founded in 1862 with an initial share capital of CHF5 million, focused on providing financing for the industry and other companies,[20][24] and had profited considerably from its close railroad connections and large warehousing facilities during the American Civil War when cotton prices rose dramatically.[36] The Toggenburger Bank was founded in 1863 with an initial share capital of CHF1.5 million,[24] and specialized as a savings and mortgage bank for individual customers, maintaining a branch office network in Eastern Switzerland. [24][37]

Bank in Winterthur, est. 1862

Toggenburger Bank, est. 1863

The new company was initially traded under the English name Swiss Banking Association, but in 1921 it was changed to Union Bank of Switzerland (UBS) to mirror its French name, Union de Banques Suisses. In German, the bank was known as the Schweizerische Bankgesellschaft (SBG).[38] The combined bank had total assets of CHF202 million and a total shareholders' equity of CHF46 million.[24] In 1917, UBS completed the construction of a new headquarters in Zurich on Bahnhofstrasse, considered to be the Wall Street of Switzerland.[20] By 1923, representations were established throughout Switzerland.[37] Although the bank suffered in the aftermath of World War I and the Great Depression, [24] it was able to make several smaller acquisitions, [37] and in 1937 it established Intrag AG, an asset management business responsible for investment trusts (i.e., mutual funds).[24] [edit]Activities in World War II

UBS "Gold Key" used to access an account number known only to the bearer.

The activities of the Union Bank of Switzerland during World War II were not publicly known until decades after the war, when it was demonstrated that UBS likely took active roles in trading stolen gold, securities and other assets during World War II.[39][40][41] The issue of "unclaimed property" of Holocaust victims became a major issue for UBS in the mid-1990s and a series of revelations in 1997 brought the issue to the forefront of national attention in 1996 and 1997. [42]UBS confirmed that a large number of accounts that had gone unclaimed as a result of the bank's policy of requiring death certificates from family members to claim the contents of the account.[43][44] UBS's handling of these revelations were largely criticized and the bank received significant negative attention in the U.S. [45][46] UBS came under significant pressure, particularly from American politicians, to compensate Holocaust survivors who were making claims against the bank.[47] In January 1997, Christoph Meili, a night watchman at the Union Bank of Switzerland, found employees shredding archives compiled by a subsidiary that had extensive dealings with Nazi Germany. The shredding was in direct violation of a recent Swiss law adopted in December 1996 protecting such material. UBS acknowledged that it had "made a deplorable mistake", but an internal historian maintained that the destroyed archives were unrelated to the Holocaust.[48] Criminal proceedings then began against the archivist for possible violation of a recent Federal Document Destruction decree and against Meili for possible violation of bank secrecy, which is a criminal offence in Switzerland. Both proceedings were discontinued by the District Attorney in September 1997.[49] Meili was suspended from his job at the security company that served UBS, following a criminal investigation. [50] Meili and his family left Switzerland for the United States where they were granted political asylum.[51][52][53] In 1997, the World Jewish Congress lawsuit against Swiss banks (WJC) was launched to retrieve deposits made by victims of Nazi persecution during and prior to World War II, ultimately resulting in a settlement of US$1.25 billion in August 1998.[54][55][56] [edit]Post-war years (19451998)

The Union Bank of Switzerland logo, ca. 1960.

Shortly after the end of World War II, Union Bank of Switzerland completed the acquisition of the Eidgenssische Bank, a large Zrich-based bank that became insolvent. As a result of the merger, Union Bank of Switzerland exceeded CHF1 billion in assets and moved its operations to Zrich. UBS opened branches and acquired a series of banks in Switzerland in the following years, growing from 31 offices in 1950 to 81 offices by the beginning of the 1960s. [24] In 1960, Union Bank of Switzerland acquired an 80% stake in Argor SA, a Swiss precious metals refinery founded in 1951 in the canton of Ticino.[28] In 1973, the bank increased the stake to full 100% ownership, though the ownership was ultimately sold between 1986 and 1999 to Argor-Heraeus SA[57][58]). UBS continues to issue gold bars via Argor-Heraeus which is famous for the unique kinebar holographic technology it uses to provide enhanced protection against bank gold bar counterfeiting.[59] By 1962, Union Bank of Switzerland reached CHF6.96 billion of assets, narrowly edging ahead of Swiss Bank Corporation to become the largest bank in Switzerland. [24][60] The rapid growth was punctuated by the 1967 acquisition of Interhandel (Industrie- und Handelsbeteiligungen AG, the corporate successor of I.G. Chemie), which made UBS one of the strongest banks in Europe.[37][61]Interhandel had become cash-rich when a dispute concerning GAF Materials Corporation, a subsidiary formerly known as General Aniline & Film and seized by the U.S. government during the war, was resolved in 1963 and the subsidiary was disposed. [62][63] By the 1980s, Union Bank of Switzerland established a position as a leading European underwriter of Eurobonds.[20] Following two major acquisitions in 1986 (Phillips & Drew and Deutsche Lnderbank), UBS made its first purchase in the United States in 1991 with Chase Investors Management Corporation, the asset management business of Chase Manhattan Bank.[64] At the time of the acquisition, the business managed in excess of US$30 billion in assets.[65] Union Bank of Switzerland entered the 1990s the largest and most conservative of the three large Swiss Banks. The bank's investments had been in the conservative asset management and life insurance businesses; further, 60% of the bank's profits came from its even more conservative Swiss banking operations. [66] In 1993, Credit Suisse outbid Union Bank of Switzerland for Switzerland's Swiss Volksbank, the fifth largest bank in Switzerland which had run into financial difficulties in the early 1990s.[60] The acquisition propelled Credit Suisse ahead of Union Bank of Switzerland as the largest bank in Switzerland for the first time. Prior to the merger with Swiss Bank Corporation, UBS purchased a group of smaller Swiss banks in 1994 including the Cantonal Bank of Appenzell-Ausserrhoden in 1996,[24] and in 1997 Schroder, Munchmeyer,

Hengst & Co. from Lloyds Bank was acquired to improve access to the German investment banking and private wealth management markets.[67] [edit]Merger

of Union Bank of Switzerland and Swiss Bank Corporation

The UBS's principal office at Bahnhofstrasse 45in Zurich, depicting the new logo, which combines the UBS letters with SBC's "three keys" symbol.

During the mid 1990s, Union Bank of Switzerland came under fire from dissident shareholders critical of its conservative management and lower return on equity.[68]Martin Ebner, through his investment trust, BK Vision became the largest shareholder in Union Bank of Switzerland and attempted to force a major restructuring of the banks operations. [69] Looking to take advantage of the situation, Credit Suisseapproached Union Bank of Switzerland about a merger that would have created the second largest bank in the world in 1996. [70] Union Bank of Switzerland's management and board unanimously rebuffed the proposed merger.[71] Ebner, who supported the idea of a merger, led a shareholder revolt that resulted in the replacement of Union Bank of Switzerland's chairman, Robert Studer with Mathis Cabiallavetta, one of the key architects of the merger with Swiss Bank Corporation.[20][72] On December 8, 1997, Union Bank of Switzerland and Swiss Bank Corporationannounced an all stock merger. At the time of the merger, Union Bank of Switzerland and Swiss Bank Corporation were the second and third largest banks in Switzerland, respectively.[73] Discussions between the two banks had begun several months earlier, less than a year after rebuffing Credit Suisse's merger overtures.[74] The merger resulted in the creation of the UBS AG, a huge new bank with total assets of more than US$590 billion.[75] Also referred to as the "New UBS" to distinguish itself from the former Union Bank of Switzerland, the combined bank became the second largest in the world, at that time, behind only the Bank of Tokyo-Mitsubishi.[75] Additionally, the merger pulled together the banks' various asset management businesses to create the world's largest money manager, with approximately US$910 billion in assets under management.[75] The combined entity was originally to be called United Bank of Switzerland, but foreseeing a problem with United Bank Switzerland, opted for UBS. The merger, which was billed as a merger of equals, resulted in the Union Bank of Switzerland's shareholders receiving 60% of the combined company and Swiss Bank's shareholders receiving the remaining 40% of the bank's common shares. Union Bank of Switzerland's Mathis Cabiallavetta became chairman of the new bank while Swiss Bank's Marcel Ospel was named chief executive officer.[75] Nearly 80% of the top management positions were filled by legacy Swiss Bank

professionals.[20] Prior to the merger, Swiss Bank Corporation was considered to be further along than Union Bank of Switzerland in developing its international investment banking business, particularly in the higher margin advisory businesses where Warburg Dillon Read was considered to be the more established platform.[76][77] Union Bank of Switzerland in turn had a stronger retail and commercial banking business in Switzerland, while both banks had strong asset management capabilities.[75] After the merger was completed, it was speculated that a series of losses suffered by UBS on its equity derivative positions in late 1997 was a contributing factor in pushing UBS management to consummate the merger.[78][79] [edit]Long

Term Capital Management

Long Term Capital Management (LTCM) was a U.S. hedge fund used for trading strategies such as fixed income arbitrage, statistical arbitrage, and pairs trading, combined with high leverage. Its collapse in 1998 led to a bailout by major banks and investment houses, and resulted in massive losses for UBS at a time when it had merged with Swiss Bank Corporation.[80][81] However, UBS involvement with LTCM pre-dated the merger. UBS had initially been reluctant to invest in LTCM, rebuffing an investment in 1994 and again shortly thereafter. UBS, suffering criticism of its conservative business model, was looking for ways to catch up to its key Swiss rivals and viewed LTCM as the type of client that could help accelerate the bank's growth. In 1997, UBS entered into a financing arrangement with LTCM, and the hedge fund quickly became the bank's largest client, generating US$15 million in fees for UBS.[82] Union Bank of Switzerland sold LTCM a 7-yearEuropean call option on 1 million shares in LTCM, then valued at about US$800 million. It hedged this option by purchasing a US$800 million interest in LTCM and invested a further US$300 million in the hedge fund.[83] Originally intended to provide UBS with a steady stream of income, UBS instead suffered major losses when the hedge fund collapsed. Following the merger, Swiss Bank managers were surprised to discover the massive exposure to LTCM at UBS.[82] Ultimately, UBS was unable to sell or hedge its interest in LTCM as its value declined in the summer of 1998. By November 1998, UBS's losses from its exposure to LTCM were estimated at approximately CHF790 million.[84] UBS would prove to be the largest single loser in the LTCM collapse, ultimately writing off CHF950 million.[20] The Federal Reserve Bank of New Yorkorganized a bailout of US$3.625 billion by the hedge fund's major creditors to avoid a wider collapse in the financial markets.[85] UBS contributed US$300 million to the bailout effort, which would largely be recovered.[86] In the aftermath of the LTCM collapse, Mathis Cabiallavetta resigned as chairman of UBS along with three other executives.[81] Following its involvement with LTCM, UBS issued a statement "Given the developments in the international financial markets, in the future UBS will [...] focus even more intensively on those areas of business likely to generate sustainable earnings with a justifiable level of risk."[81] [edit]Rising

in the league tables (20002007)

UBS PaineWebber logo in use from 2001 until 2003 when the use of the Paine Webber brand was dropped

On November 3, 2000, UBS merged with Paine Webber, an American stock brokerageand asset management firm led by chairman and CEO Donald Marron.[87][88][89] At the time of its merger with UBS, Paine Webber had emerged as the fourth largest private client firm in the United States with 385 offices employing 8554 brokers. The acquisition pushed UBS to the top Wealth and Asset Management Firm in the world. Initially the business was given the divisional name "UBS PaineWebber" but in 2003 the 123-year-old name Paine Webber disappeared when it was renamed "UBS Wealth Management USA."[90] UBS took a CHF 1 billion writedown for the loss of goodwill associated with the retirement of the Paine Webber brand when it integrated its brands under the unified UBS name in 2003. [91]

UBS Warburg was the brand used for the Investment Banking division of UBS from 1999 to 2003.

John P. Costas, a former bond trader and co-head of Fixed Income at Credit Suisse First Boston and head of Fixed Income Trading at Union Bank of Switzerland in 1998, was appointed CEO of UBS's investment banking division, which originated in SBC's Warburg Dillon Read division and got renamed UBS Warburg in December 2001. [92][93] In an attempt to break into the elite bulge bracket of investment banks, in which UBS currently had little success while rival Credit Suisse was establishing itself as a major player on Wall Street with the acquisition of Donaldson Lufkin & Jenrette in 2000,[94] Costas shifted the growth strategy from acquiring entire firms to hiring individual investment bankers or teams of bankers from rival firms.[95] Costas had followed a similar approach in building out the UBS fixed income business, hiring over 500 sales and trading personnel and increasing revenues from US$300 million in 1998 to over US$3 billion by 2001. The arrival of former Drexel Burnham Lambert investment banker Ken Moelis marked a major coup for Costas. Moelis joined UBS fromDonaldson Lufkin & Jenrette in 2001 shortly after its acquisition by Credit Suisse First Boston. In his six years at UBS, Moelis ultimately assumed the role of president of UBS Investment Bank and was credited, along with Costas, with the build-out of UBS's investment banking operation in the United States. [96] Within weeks of joining, Moelis brought over a team of 70 bankers from Donaldson, Lufkin & Jenrette. [96] Costas and Moelis hired more than 30 senior U.S. bankers from 2001 through 2004.[92] It was estimated that UBS spent as much as US$600 million to US$700 million hiring top bankers in the U.S. during this three-year period.[97]Among the bank's other major recruits during this period were Olivier Sarkozy, Ben Lorello,[98][99] Jeff McDermott[100] and Blair Effron. By 2003, UBS had risen to fourth place from seventh in global investment banking fees, earning US$2.1 billion of the US$39 billion paid to investment banks that year, increasing 33%. [92] Over the next four years, UBS consistently ranked in the top 4 in the global fee pool and established a track record of 20 consecutive quarters of rising profits. [101] However, by the end of 2006, UBS began to experience changing fortunes. In late 2005, Costas headed a new hedge fund unit within UBS known as Dillon Read Capital Management. His former position was taken over by Huw Jenkins, a

long-time legacy UBS investment banker.[102] In 2006, UBS bankers Blair Effron and Michael Martin announced their departures.[103][104] In March 2007, Moelis announced that he was leaving the company, [101] and shortly thereafter founded a new business, Moelis & Company. As he had when joining UBS, Moelis took a large team of senior UBS investment bankers.[105][106][107] Moelis's departure was caused primarily by repeated conflict over the availability of capital from the bank's balance sheet to pursue large transactions, particularly leveraged buyouts.[108] The bank's apparent conservatism would be turned on its head when large losses were reported in various mortgage securities rather than corporate loans that generated investment banking fees. After Moelis, other notable departures included investment banking co-head Jeff McDermott in early 2007[104] and, as the financial crisis set in, other high profile bankers such asOliver Sarkozy[109] in early 2008 and Ben Lorello in 2009.[99] [edit]The

Subprime mortgage crisis (2007)

See also: Subprime mortgage crisis In early 2007, UBS became the first Wall Street firm to announce heavy losses in the subprime mortgage sector as the subprime mortgage crisis began to unfold. In May 2007, UBS announced the closure of its Dillon Read Capital Management division. Before that time, there was little understanding of the troubles at DRCM or the massive expansion of risk engineered by the investment banking division under the leadership of the newly placed CEO Huw Jenkins. [110] DRCM, which was a large internal hedge fund, had been started to much publicity in 2005 and invested money both on behalf of UBS and some of its clients. However, DRCM had been formed in large part to keep some of the bank's traders from defecting to hedge fundsas well as to create a position for John Costas who had been instrumental in creating UBS's successful investment banking business in the U.S. from 2001-2005.[102] Costas had been replaced by Huw Jenkins, a longtime legacy UBS investment banker with little fixed income or mortgage experience. DRCM hired a large team of professionals, many of whom were attracted from the investment bank with large compensation packages. [111] Although in 2006, DCRM had generated a profit for the bank of US$720 million, after UBS took over DRCM's positions in May 2007 and removed hedges allowing losses to grow from the US$124 million recorded by DRCM, ultimately to "16% of the US$19 billion in losses UBS recorded." The UBS investment bank continued to expand sub prime risk in the second quarter of 2007 while most market participants were reducing risk resulting in not only expanding DRCM losses but creating the 84% of the other losses experienced by the bank.[112] By October 2007, UBS was indicating that the assets could not be sold given the illiquidity in the market.".[113][114] In response to the growing series of problems at UBS, Peter Wuffli unexpectedly stepped down as CEO of the firm during the second quarter of 2007.[115] Wuffli would be joined by many of his fellow managers in the next year, most notably the bank's chairman Marcel Ospel. However, the bank's problems continued through the end of 2007, when the bank reported its first quarterly loss in over five years. [116] As its losses jeopardized the bank's capital position, UBS quickly raised US$11.5 billion of capital in December 2007, US$9.7 billion of which came from the Government of Singapore Investment Corporation (GIC) and US$1.8 billion from an unnamed Middle Eastern investor. [117] Those 2007 capital injections would initially be highly unpopular among UBS shareholders who clamored to have an opportunity to participate on the same

terms.[118] However, over time, these early investments in UBS proved to be unsuccessful for the investors involved as the bank's stock price remained below 2007 levels more than two years later. [119] [edit]Impact

of the financial crisis (20082009)

See also: Financial Crisis of 2008 and Dillon, Read & Co. After a significant expansion of fixed income risk under the leadership of Huw Jenkins, UBS Investment Bank CEO, during 2006 and 2007 the bank's losses continued to mount in 2008 when UBS announced in April 2008 that it was writing down a further US$19 billion of investments in subprime and other mortgage assets. ( Huw had been asked to leave in October 2007. By this point, UBS's total losses in the mortgage market were in excess of US$37 billion, the largest such losses of any of its peers.[120] In response to its losses, UBS announced a CHF15 billion rights offering to raise the additional funds need to shore up its depleted reserves of capital. UBS cut its dividend in order to protect its traditionally high tier 1 capital ratio, seen by investors as a key to its credibility as the world's largest wealth management company. [121][122] Marcel Ospel, who had been the architect of the merger that created UBS in 1998, also announced that he would step down as chairman of the bank to be replaced by Peter Kurer, the banks general counsel with virtually no banking experience. This ultimately proved very costly to UBS. In October 2008, UBS announced that it had placed CHF6 billion of new capital, through mandatory convertible notes, with Swiss Confederation. The SNB (Swiss National Bank) and UBS made an agreement to transfer approximately US$60 billion of currently illiquid securities and various assets from UBS to a separate fund entity.[123] UBS raised an additional US$11.5 billion of capital in December 2007, US$9.7 billion of which came from the Government of Singapore Investment Corporation (GIC) and US$1.8 billion from an unnamed Middle Eastern investor. In November 2008, UBS put US$6 billion of equity into the new bad bank entity, keeping only an option to benefit if the value of its assets were to recover. Heralded as a neat package by the New York Times, the UBS structure guaranteed clarity for UBS investors by making an outright sale.[124] UBS announced in February 2009 that it had lost nearly CHF20 billion (US$17.2 billion) in 2008, the biggest single-year loss of any company in Swiss history.[125] Since the beginning of the financial crisis in 2007, UBS has written down more than US$50 billion from subprime mortgage investments[126] and cut more than 11,000 jobs.[127] [edit]U.S.

tax evasion controversy

In June 2008, the U.S. Federal Bureau of Investigation made a formal request to travel to Switzerland to probe a multimillion-dollar tax evasion case involving UBS.[128] The investigation had, in part, been prompted by disclosures made by Brad Birkenfeld, a former UBS banker in Switzerland, who testified to the US Department of Justice, the US Securities and Exchange Commission, and the US Internal Revenue Service. [129] In July 2008, a United States Senate panel accused Swiss banks, including UBS and LGT Group, of helping wealthy Americans evade taxes through offshore accounts, and calculated the total cost of this practice as being in excess of US$100 billion annually.[130] The report specifically accused UBS AG and Liechtenstein's LGT Group of allegedly marketing tax-evasion strategies to wealthy Americans. [131] U.S. clients held about 19,000 accounts at UBS, with an estimated US$18 billion to US$20 billion in assets, in Switzerland, according to

the findings.[132] In response to the report and the FBI investigation, UBS announced that it would cease providing crossborder private banking services to US-domiciled clients through its non-US regulated units as of July 2008.[133] In November 2008, a U.S. federal grand jury indicted Raoul Weil, Chairman and CEO of UBS Global Wealth Management and Business Banking and member of UBS's Group Executive Board, in connection with the ongoing investigation of UBS's US crossborder business.[134] UBS would eventually cut ties to Raoul Weil in May 2009 and he would face charges after UBS had settled its criminal case with the government. [135] UBS agreed on February 18, 2009 to pay a fine of US$780 million to the U.S. government and entered into a deferred prosecution agreement on charges of conspiring to defraud the United States by impeding the Internal Revenue Service. Of the US$780 million that UBS will pay, US$380 million represents disgorgement of profits from its cross-border business; the balance represents United States taxes that UBS failed to withhold on the accounts. [136][137] The figures include interest, penalties and restitution for unpaid taxes. As part of the deal, UBS also settled Securities and Exchange Commission charges of having acted as an unregistered broker/dealer and investment adviser for Americans. [138] The day after settling its criminal case on February 19, 2009, the U.S. government filed a civil suit against UBS to reveal the names of all 52,000 American customers, alleging that the bank and these customers conspired to defraud the IRS and federal government of legitimately owed tax revenue. [139] The Swiss Financial Market Supervisory Authority (FINMA) had given the United States government the identities of, and account information for, certain United States customers of UBSs cross-border business as part of its criminal investigation in 2009. On August 12, 2009, UBS announced a settlement deal that ended its litigation with the IRS.[140][141] However, this settlement set up a showdown between the U.S. and Swiss governments over the secrecy of Swiss bank accounts. It was not until June 2010 that Swiss lawmakers approved a deal to reveal client data and account details of U.S. clients who were suspected of tax evasion. [142] [edit]Re-establishment

(2009current)

UBS Investment Bank lobby at 299 Park Ave in New York

By the spring of 2009, UBS announced another management restructuring and initiated a plan to return to profitability. Jerker Johansson, the head of the investment bank division, resigned in April 2009 and was replaced by Alex Wilmot-Sitwell and Carsten Kengeter.[143]At the same time, UBS announced the planned elimination of 8,700 jobs [144] and had implemented a new compensation plan. Under the plan, no more than one-third of any cash bonus would be paid out in

the year it is earned with the rest held in reserve and stock-based incentives that would vest after three years; top executives would have to hold 75% of any vested shares. Additionally, the bank's chairman, Peter Kurer, would no longer receive any extra variable compensation, only a cash salary and a fixed allotment of shares that could not be sold for four years. Also, in April 2009, UBS announced that it has agreed to sell its Brazilian financial services business, UBS Pactual, for approximately US$2.5 billion to BTG Investments.[145] UBS rejected proposals to break apart the bank and divest its investment banking division.[146] By the summer of 2009, UBS was showing increased signs of stabilization. Taking advantage of conditions in the stock market, UBS placed US$3.5 billion of shares with a small number of large institutional investors. The Swiss government sold its CHF6 billion stake in UBS in late 2008 at a large profit; Switzerland had purchased convertible notes in 2008 to help UBS clear its balance sheets of toxic assets. [147] Oswald Grbel announced, We are building a new UBS, one that performs to the highest standards and behaves with integrity and honesty; one that distinguishes itself not only through the clarity and reliability of the advice and services it provides but in how it manages and executes." Grbel reiterated plans to maintain an integrated business model of providing wealth management, investment banking and asset management services. [148] In August 2010, UBS launched a new advertising campaign featuring the slogan: We will not rest" and signed a global sponsorship agreement with Formula 1. On October 26, 2010, UBS announced that its private bank recorded net new funds of CHF900 million during the third quarter, compared to outflow of CHF5.5 billion in second quarter.[149] UBS's third quarter net profit of US$1.65 billion beat analyst estimates, continuing a string of profitability. After the elimination of almost 5,000 jobs, UBS announced on August 23, 2011 that it was further eliminating another 3,500 positions in order to "improve operating efficiency" and save CHF1.5 to CHF2 billion a year. 45 percent of the job cuts will come from the investment banking unit, which has continued to post dismal figures since the 2008 financial crisis, while the rest would come from the wealth management and asset management divisions. The firm has seen profits fall due to the rise of the Swiss franc.[150][151] [edit]2011

rogue trader scandal

Main article: 2011 UBS rogue trader scandal On 15 September 2011, UBS became aware of a massive loss, originally estimated at US$2 billion, due to unauthorized trading allegedly by Kweku Adoboli, a then 31-year-old trader on the Delta One desk of the firms investment bank.[152] Adoboli was arrested and later charged with fraud by abuse of position and false accounting dating as far back as 2008.[153] UBS's actual losses were subsequently confirmed as US$2.3 billion.[154] The bank stated that no client positions had been affected[155] and its CEO Oswald Gruebel initially dismissed calls for his resignation, commenting that if someone acts with criminal intent, you cant do anything. [156] However, UBS's management was subsequently criticized for its "lapses" by the Government of Singapore Investment Corporation, the bank's largest shareholder, in a rare press statement on 20 September 2011; [157] and on 24 September 2011 UBS announced Grbel's

resignation, with Sergio Ermotti named Group CEO on an interim basis.[158] On 5 October 2011, Francois Gouws and Yassine Bouhara, co-heads of UBS's Global Equities franchise, also resigned. [159] The scale of UBS's losses led to renewed calls for the global separation of commercial banking from investment banking[160] while media commentators suggested UBS should consider downsizing its investment bank and potentially rebranding it under the resurrected S.G. Warburg name.[161][162] In Switzerland, where the Government had bailed out UBS in 2008 [163] particular concern was voiced about the nature of the alleged trading which, it was suggested, might have been directed against the interests of the Swiss economy. Christian Levrat, President of the SP-Party said, "Should it prove true that UBS, having been rescued by the state in 2008, has speculated against the Swiss franc, [UBS Chairman] Villiger must take the consequences."[164] If found guilty, Abodoli will have generated the third-largest loss by a rogue trader in history, after Jerome Kerviel of Socit Gnrale(who also worked on a Delta One desk) and Yasuo Hamanaka, a copper trader at Sumitomo Corporation.[165] [edit]Acquisition

history

UBS as it exists today represents the combination of dozens of individual firms, many of which date to the 19th century. Over the years, these firms merged to form the bank's three major predecessors, Union Bank of Switzerland, Swiss Bank Corporation and Paine Webber. The following is an illustration of the company's major mergers and acquisitions and historical predecessors, although this is not necessarily a comprehensive list: [166]
Union Bank of Switzerland
(merged 1998) (originally Swiss Banking Association, merged 1912)

Bank in Winterthur
(est. 1862)

Union Bank of Switzerland

Toggenburger Bank
(est. 1863)

Aargauische Kreditanstalt
(merged 1915, acq. 1919)

Aargauische Kreditanstalt
(est. 1872)

Bank in Baden
(est. 1863)

Eidgenssische Bank
(est. 1863, acq. 1945)

Interhandel
(est. 1928, acq. 1967)

Phillips & Drew

(est. 1895 as G.A. Phillips & Co., acq. 1986)

(est. 1972 as subsidiary)

Schroder, Munchmeyer, Hengst & Co. (merged 1969, acq. 1997)

Schrder Brothers & Co.

(est. 1846)

Mnchmeyer & Co.

(est. 1855)

Frederick Hengst & Co. Swiss Bank Corporation

(merged 1897)

Basler & Zrcher Bankverein

(est. 1880)

Basler Banvkerein
(est. 1856 as Bankverein, renamed in 1872)

Swiss Bank Corporation

Zrcher Bankverein
(est. 1889)

Basler Depositenbank
(est. 1882)

Schweiz Unionbank
(est. 1889)

Basler Handelsbank
(est. 1862, acq. 1945)

O'Connor & Associates

(est. 1977, acq. 1992)

Brinson Partners
(est. 1989, acq. 1994)

Warburg Dillon Read

(merged 1997 under SBC ownership)

S. G. Warburg & Co.

(est. 1946, acq. 1995)

Dillon, Read & Co.

(est. 1832, acq. 1997)

Paine Webber
(consolidated three subsidiaries in 1984)

Paine, Webber, Jackson & Curtis

(merged 1942)

Paine & Webber

(est. 1880)

(est. 1879)

Mitchell Hutchins
(est. 1938, acq. 1975)

Blyth, Eastman Dillon & Co.

(merged 1972, acq. 1979)

Blyth & Co.

(est. 1914 as Blyth, Witter & Co.

Eastman Dillon Union Securities & Co.

(merged 1956)

Union Securities
(est. 1939 as spinoff from J. & W. Seligman & Co.

Eastman Dillon & Co.

(est. 1912)

Kidder, Peabody & Co.

(est. 1864, acq. 1995)

J.C. Bradford & Co.

(est. 1928, acq. 2000)

[edit]Management [edit]Board

of Directors

The Board of Directors is the most senior corporate body with ultimate responsibility for the strategy and the management of the company and for the appointment and supervision of its executive management. [167] Its members, as of 3 May 2012, are:[168]

Axel A. Weber, Chairman Michel Demar, Vice Chairman David Sidwell, Senior Independent Director Rainer-Marc Frey, founder and chairman of Horizon21 Ann Godbehere Axel P. Lehmann, Group Chief Risk Officer of Zurich Financial Services Wolfgang Mayrhuber, Chairman and CEO of Lufthansa Helmut Panke William G. Parrett Isabell Romy, partner, Niederer Kraft & Frey[169] Beatrice Weder di Mauro, former member German Council of Economic Experts Joseph Yam

Chairman Marcel Ospel did not seek re-election at the April 23, 2008 annual general meeting of shareholders and was succeeded byPeter Kurer, who was general counsel.[170] On April 15, 2009, Peter Kurer was succeeded by Kaspar Villiger. Former Bundesbankpresident Axel A. Weber was nominated for election to the board at the annual meeting 3 May 2012 in mid-2011 and, at that time, intended to be named chairman of the board after Villiger's retirement in 2013. [171][172] In May, 2012, Villiger and board member Bruno Gehrig stepped down. [168] [edit]Group

Executive Board

The Group Executive Board is the executive body of the company, the members of which are:

Group Chief Executive Officer: Sergio Ermotti Group Chief Operating Officer & CEO Corporate Center: Ulrich Krner Group Chief Financial Officer: Tom Naratil Group General Counsel: Markus U. Diethelm Group Chief Risk Officer: Philip J. Lofts CEO Global Asset Management: John A. Fraser CEO Investment Bank: Carsten Kengeter CEO Wealth Management Americas: Robert J. McCann CEO Wealth Management: Jurg Zeltner CEO Wealth Management & Swiss Bank: Lukas Ghwiler [173] and Jurg Zeltner (joint) CEO UBS Switzerland: Lukas Ghwiler[173] CEO UBS Group Americas: Robert J. McCann Chairman and CEO UBS Group Asia Pacific (APAC): Chi-Won Yoon[174] and Alex Wilmot-Sitwell (joint) Chairman and CEO of UBS Group Europe, Middle East and Africa (EMEA): Ulrich Krner

With Oswald Grbel's resignation as CEO and Ermotti's interim appointment in his place 24 September 2011, the Wall Street Journalreported that the succession process appeared to be a two-person race between Ermotti from EMEA and Kengeter from the investment bank. Ermotti, who had spent many years at what is now Bank of America Merrill Lynch, joined UBS in April; Kengeter is a German national who joined UBS from Goldman Sachs in 2008 and who had reportedly disagreed with some UBS investment bankers over pay and other matters; the Journal also said.[175] Previously, on 26 February 2009, Marcel Rohner resigned and was succeeded by Grbel.[176] On 1 April 2009, Grbel hired Ulrich Krner, in a newly established role as Chief Operating Officer (COO) and CEO of Corporate Center. Krner's task was to be to cut administrative expenses and boost profits. [177] [edit]Legal

controversies

On May 10, 2004, UBS was fined US$100 million by the U.S. Federal Reserve for illegally transferring funds from an account set up by the Federal Reserve at UBS to Iran, Cuba and other countries presently under a U.S. trade embargo. [178] In April 2005, UBS lost the landmark discrimination and sexual harassment case, Zubulake v. UBS Warburg. The plaintiff, Laura Zubulake, was former institutional equities salesperson at the company's Stamford office. The jury found that her manager, Matthew Chapin, had denied her important accounts and mocked her appearance to co-workers. She claimed several sexist policies in place, such as entertaining clients at strip clubs, made it difficult for women to socialize and foster business contacts with clients.[179] The jury found that UBS had destroyed relevant e-mail evidence after the litigation hold had been in place. UBS was ordered to pay the plaintiff US$9.1 million in compensatory damages (including back pay and professional damage), and US$20.2 million in punitive damages.[180] The Securities and Exchange Board of India (SEBI) alleged that UBS had played a role in the 2004 Black Monday stock market crash which followed the National Democratic Alliance governments defeat in the general elections. SEBI's ruling of May 17, 2005 barred UBS from issuing or renewing participatory notes for a period of one year.The ban was later lifted on appeal, as a result of a government tribunal ruling on September 9, 2005. On October 18, 2005, three African-American employees filed a class action lawsuit against the company in the United States District Court for the Southern District of New York alleging racial discrimination in hiring, promotion and other employment practices. The three plaintiffs in Freddie H. Cook, Sylvester L. Flaming Jr. and Timothy J. Gandy v. UBS Financial Services, Inc., claim that segregation and discrimination in job assignments and compensation were widespread and the firm had done nothing to diversify its workforce. The lawsuit also claims offices operating in Largo, Maryland and Flushing, New York were illegally created to serve African-Americans and Asian-Americans respectively, and that the firms management frequently ridiculed the Largo branch office and its staff, referring to it as a diversity office. On April 23, 2007, U.S. District Judge, Peter J. Messitte, granted plaintiff's request to dismiss the class allegations without prejudice. As a result of this dismissal, the case now comprises the individual claims of three plaintiffs.[181][182] [edit]Corporate

social responsibility

In January 2010, UBS issued a new code of conduct and business ethics which all employees were asked to sign. The code addressed issues such as financial crime, competition, confidentiality, as well as human rights and environmental issues. The eight-page code also lays out potential sanctions against employees who violate it, including warnings, demotions or dismissal. According to Kaspar Villiger, Chairman of the Board, and Oswald J. Grbel, former Group CEO, the code is "an integral part of changing the way UBS conducts business". [183] [edit]Recognition UBS was named one of the 100 Best Companies for Working Mothers living in the U.S. in 2006 for the fourth consecutive year[184] by U.S. based Working Mother magazine. It is a member of the Stonewall Diversity Champions scheme and has active Gay and Lesbian, ethnic minority, and women's networking groups. UBS was included on Business Week's The Best Places to Launch a Career 2008, and ranked #96 out of the 119 total companies listed. [185] On February 2, 2010, UBS topped the charts for the ninth year in a row in Institutional Investor's annual ranking of developed Europe's most highly regarded equity analysts. In a year of extremes for the equity markets, money managers say that no firm did a better job than UBS of keeping them informed about which European sectors, countries and industries offered the greatest potential.[186] On May 4, 2010, UBS Investment Bank was voted the Leading Pan-European Brokerage firm for Equity and Equity Linked Research for a record tenth successive year. The Thomson Reuters Extel Survey ranked UBS number one in all three of the key disciplines of research: Research (tenth year); Sales (ninth year running) and Equity Trading and Execution (up from second place in 2009). This year UBS was also named as the number one Leading Pan-European Brokerage Firm for Economics and Strategy research.[187] [edit]Sponsorship [edit]Sport UBS has been or is currently a sponsor of the following sporting events and organizations. UBS is particularly active in sponsoring various golf tournaments, cross-country skiing in Switzerland ice hockey, and a range of other events around the world. UBS was the sponsor of the Alinghi sailing ship, winner of the Americas Cup in 2003.

Alinghi Arnold Palmer Invitational Athletissima Faldo Series Asia

Hong Kong Rugby Football Union Murten to Fribourg: Commemorative Race

Swiss Olympic Leading Partners UBS 7-Hills Racing Team (Cincinnati, Ohio Bicycle Team)

Olympic Museum Lausanne The Players Championship Sierre Zinal Race (cross-country) Spengler Cup Davos

UBS Hong Kong Open UBS Japan Golf Tour Championship UBS Kids Cup Weltklasse Zrich

Escalade Race (cross-country) Formula One Greifenseelauf

[edit]Culture

UBS has been or is currently a sponsor of the following cultural events and organizations. Typically UBS's cultural sponsorships are related to classical music and contemporary art although the firm also sponsors a range of film festivals, music festivals and other engagements.

Art Basel Art Basel Miami Beach Art Gallery NSW Basel Sinfonietta Boston Symphony Orchestra Bregenz Festival Cy Twombly exhibition Fondation Beyeler

Fondation Pierre Gianadda International Mozarteum Foundation Lake Thun Festival Locarno International Film Festival London Symphony Orchestra Lucerne Festival Lugano Festival Lucerne Symphony Orchestra

Montreux Jazz Festival Open-air cinemas (Kino am See) Ravina Festival Singapore Sun Festival Utah Symphony Verbier Music Festival Zurich Ballet Zurich Opera

BRANCHES

UBS AG is a diversified global financial services company. It is the world's second largest manager of private wealth assets. UBS operates in all of the major financial centers worldwide with offices in over 50 countries. UBS's global business groups are private banking, investment banking, and asset management. Total assets: CHF 1,366 billion (as of March 31, 2012). Net income: CHF 4.23 billion (2011). UBS is one of the leading providers of retail banking and commercial banking services in Switzerland. UBS has a major presence in the U.S., with its American headquarters located in New York City (Investment banking); Weehawken, New Jersey (Private Wealth Management); and Stamford, Connecticut (Sales & Trading). UBS has more than 64500 employees worldwide. Union Bank of Switzerland and Swiss Bank Corporation merged in 1998.

eadquarter: Key People:

Zurich, Switzerland Kaspar Villiger (Chairman), Sergio Ermotti (Group CEO)

Company Type: Public (SIX: UBSN, NYSE: UBS)

Head Office: Bahnhofstrasse 45 8001 Zurich Phone: +41-44-234 11 11

Fax:
SWIFT (BIC): Founded: 1998

+41-44-239 91 11
UBSWCHZH

Locations
UBS operates in over 50 countries and from all major international financial centers.

Head offices in Switzerland, maps, directions

Bahnhofstr. 45, P.O. Box, CH-8098 Zurich, Tel. +41-44-234 11 11, Fax +41-44-239 91 11 Aeschenvorstadt 1, P.O. Box, CH-4051 Basel, Tel. +41-61-288 20 20, Fax +41-61-288 45 76

Main offices worldwide, maps, directions

1285 Avenue of the Americas, New York, NY 10019, +1-212-713-2000 299 Park Avenue, New York, NY 10171, +1-212-821 3000

1 North Wacker Drive, Chicago IL 60606, +1-312-525 5000 Lincoln Harbor Facility, 800, 1000 and 1200 Harbor Boulevard, Weehawken, NJ 07086, +1-201-352-3000 677 Washington Boulevard, Stamford CT 06912, +1-203-719 3000 1 Finsbury Avenue, London, EC2M 2PP, +44-20-7567 8000 100 Liverpool Street, London, EC2M 2RH, +44-20-7567 8000 East Tower, Otemachi First Square, 5-1 Otemachi 1-chome, Chiyoda-ku, Tokyo 100-0004, +81-3-5293 3600 52/F, Two International Finance Centre, 8 Finance Street, Central, Hong Kong

Branches worldwide
The Location Finder offers worldwide branch information such as address, telephone number or opening hours as well as clearing, postal or Swift numbers in Switzerland. Choose your region:

United States and Canada Switzerland Europe Asia Pacific Middle East and Africa Latin America and the Caribbean

Web services

Apps
UBS provides numerous apps for the most common mobile devices. More

Social Media
UBS is present on various social media platforms. Following our listed official Social Media presences offers a quick and easy way to receive the latest UBS news. More

Podcasts
UBS offers various podcasts for download to your portable player or podcast software. More

RSS
UBS provides RSS feeds, enabling you to see current UBS news in your RSS reader. More

ORGANISATION STRUCTURE

Our strategy
Our strategy is centered on the long-standing position of our global wealth management businesses and our universal bank in Switzerland. Together with a focused, less complex and less capital-intensive Investment Bank and a Global Asset Management business, we will drive further growth and expand our premier wealth management franchise.

Our strategy plays to our strengths, enables us to better serve our clients and deliver more attractive returns to shareholders.

About our businesses

Our pre-eminent wealth management business is the worlds leading wealth manager for high net worth and ultra high net worth clients. Our goal is to extend our leadership position.

We are the biggest and strongest universal bank in Switzerland, and our retail and corporate business is critical to the Group in terms of both revenue and profitability. Our leading position in Switzerland helps sustain our global brand and our leading wealth management businesses.

Our investment bank is a key element of our client-centric strategy. It will focus on serving the needs of its core clients across wealth management, institutional, corporates, sovereigns and sponsors and investing in its leading advisory, capital markets, and client flow and solutions businesses. Our goal is to make our investment bank more focused, less complex and capital intensive, and last but not least, consistently profitable.

Our global asset management business will continue to deliver investment services to its third party institutional and wholesale clients, and the clients of UBSs wealth management businesses through its well-diversified investment capabilities. The combined assets of our wealth management and asset management businesses rank UBS amongst the top investment management firms in the world, and we will look to reinforce this position going forward.

About our clients

We are the worlds leading wealth manager for high net worth and ultra high net worth clients. More than 40% of the global assets of our wealth management client assets come from ultra high net worth clients, many of whom are successful entrepreneurs, who think and act like institutions.

The complementary needs of our clients enable us to maximize value. In order to best serve our core wealth management clients, our global asset management business and our investment bank must each be strong and successful in meeting the needs of their corporate, sovereign, institutional and financial sponsor clients.

About our capital strength

Our strong capital, liquidity and funding positions form the foundation of our strategy and give us a competitive advantage over our global peers.

With a target of 13% tier one common equity under Basel III, we aim to deliver an overall return on equity of 12-17% starting from 2013.

HEADQUATERS OF UBS