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Your support makes all the difference.UBS lost £191m more than it initially thought after falling victim to what may be the largest rogue trading scandal ever to hit the City.
The Swiss banking giant had estimated the losses at £1.3bn when confirming the unauthorised trades last week, but after unwinding the positions of alleged rogue trader Kweku Adoboli, it announced yesterday that the sum was closer to £1.5bn.
UBS also said they had approached Mr Adoboli with questions after reviewing some of his positions. All of the losses relate to trades made in the past three months, it said, and the bank has set up a special committee to investigate how it failed to pick up on the unauthorised trading.
Mr Adoboli was arrested last week after it emerged that huge losses had been run up from a series of unauthorised trades. He has been remanded in custody until a hearing later this month.
The trader wept in the dock of City of London magistrates court on Friday as he was charged over offences dating back to 2008. Yet as these did not lose UBS any money, the bank's special committee will not investigate them.
UBS yesterday also lifted the lid on the nature of the trades carried out. "The loss resulted from unauthorised trading in various S&P500, DAX and EuroStoxx index futures over the past three months," the statement said.
It added that the true magnitude of the risk exposure had been distorted because the positions had been hedged with "fictitious trades", obscuring the fact that they violated the bank's risk limits.
It emerged over the weekend that bets totalling £6.4bn had been made at UBS last week. Mr Adoboli's boss John Hughes is understood to have left the bank after the news emerged on Thursday morning.
UBS brought together a team dubbed Project Bronze to unwind existing trading positions, preventing it from further losses.
Mr Adoboli's lawyers Kingsley Napley, who also represented the UK's most notorious rogue trader Nick Leeson following the scandal that brought down Barings, are yet to release a comment on Mr Adoboli's behalf.
In Switzerland, the management team has come under increasing pressure since the incident. Chief Executive Oswald Gruebel, who was brought in two years ago as the bank struggled to cope during the credit crunch, said he would not step down in light of the scandal.
He told one domestic newspaper: "If you ask me whether I feel guilty, I say no," adding: "I am not thinking of stepping down." It is understood that significant shareholders including the Singapore sovereign wealth fund and the Government of Singapore Investment Corporation were backing the embattled chief executive.
Just three weeks before, the bank announced a major cost-cutting drive with as many as 3,500 employees facing the sack. Rumours have been rife that not only will most of the bank's staff not receive bonuses but there may be more cuts in the wake of the losses.
There has also been focus on the bank's risk systems. Peter Norris, Mr Leeson's boss at the time of the Barings collapse, called for reform of such protocol. In an interview with The Independent on Sunday, he said the fallout for UBS and Mr Adoboli's colleagues "will be huge".