Crunch forces UBS to cut 5,500 jobs
Wed 7 May 2008
07/05/2008
Credit crunch losses have forced Swiss investment bank, UBS to announce it will lay off 5,500 workers. The news follows its first quarter losses of $19 billion (£9.7 billion) on US real estate and an overall deficit of £5.6 billion. "The downward spiral in US mortgages and related instruments accelerated during first quarter and also spread to other structured credit positions," it announced. The bank hopes to reduce staff numbers by natural attrition and internal redeployment, but has warned it will not be possible to avoid redundancies entirely. Marcel Rohner, chief executive officer, said its actions to counter current problems are proving effective: "We can see tangible effects as a result of our initial responses to the losses." Research by Watson Wyatt has found firms that do not balance financial imperatives and employee reward preferences can lose their best workers.
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