UBS expects small profits in third quarter

AFP - Thursday, October 2 06:57 am

ZURICH (AFP) - Switzerland's biggest bank UBS, one of the worst-hit by the subprime crisis, said Thursday it expects a small profit for the third quarter after sharply cutting its US mortgage-related positions.

Chairman Peter Kurer will tell shareholders during an extraordinary general meeting later Thursday that the bank would also earn profits in 2009, a statement said.

UBS last year posted its first-ever full-year loss of 4.4 billion Swiss francs (3.9 billion dollars, 2.8 billion euros) due to massive asset writedowns of subprime-related positions.

This year, it has already posted losses in two successive quarters. The subprime crisis has forced the bank to write down over 42.5 billion dollars worth of assets so far.

With the financial crisis in the United States taking a turn for the worse over the past two weeks, some analysts had expected UBS to post further writedowns when it reports its third quarter results on November 4.

But the bank expects a recovery.

"Despite recent extremely volatile market conditions, UBS currently expects to report a small profit for the third quarter, based on preliminary estimates," said a statement summarising Kurer's address to shareholders.

The bank had disposed much of its US commercial and residential mortgage-related positions, it added.

It has also embarked on a programme to reposition itself and take remedial measures following the crisis, including the way it apportions risks.

"2009 will be an overall profitable year. UBS, at all times, wants to maintain a strong capital base, adequate liquidity and a reduced, solid balance sheet," the UBS statement said.

• Email Story
• IM Story
• Printable View
• Blog This
• Post a Comment

Sponsored Links

(What’s this?)