Former UBS president-turned-activist-investor Luqman Arnold wants to shake things up at the Swiss bank. Arnold said in a
letter sent to board member Sergio Marchionne that the bank's board of directors should be nonexecutive rather than executive, and that Marchionne himself should become chairman. Arnold is also recommending separating the wealth management business and banking from the investment bank by
selling off asset management and the Brazilian division Pactual. This is after UBS lost about $38 billion in write-downs.
The blogs and discussion boards are buzzing with commentary, after the jump are some of the latest.
- Maria Woehr
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Toomre Capital Markets LLC writes:
How About $19 Billion More in Write-downs?, TCM wonders "when UBS will be issuing the press release that they no longer have a fixed-income sales and trading business. Or perhaps that will never come as this global bank continues to demonstrate its complete and utter (in)competence? One has to wonder what part John Costas and the ill-fated Dillon Read Capital Management had in these losses." How UBS as institution allowed itself to take on some $100 billion in mortgage and structured credit assets that have resulted in write-downs thus far of approximately $38 billion is simply incomprehensible.
Todd Sullivan's ValuePlays posted:
UBS essentially has placed securities linked to US mortgages into a separate subsidiary. The eventual goal will be either to spin off the subsidiary or, in the short term, sell chunks of it to investors.
24/7 Wall St said:
In the end, the math has become almost too complex, even for Wall St.'s best minds. This is because issues of liabilities have gone from a regular part of doing business as a financial institution to being a mine field of poorly understood pools of paper. The values of these depend on forces in the credit markets and economy which are far afield of where banks normally would invest capital. Mutations often end up being very different from the host.
For more links to UBS discussions check out:
Yahoo! discussion boards
Google discussion boards
UBS chairman exits
Comments
Clive Standish was responsible for 99% of this mess. He and Huw Jenkins thought they could run UBS. Obviously they lacked the expertise and intellect. Was not as easy as it looked was it boys!! Your friend Markus.