After the last financial crisis (apparently in the dim and distant past of 2008-09), there were a few obvious lessons for banks. These included banks not lending on a highly speculative basis and then ‘bundling’ a series of these highly uncollaterised loans into instruments that were sold on as good solid investments. It also included banks themselves having internal controls to check what was going on.
There was also widespread condemnation for the exorbitant bonuses being paid, especially in the investment divisions of banks.
UBS, a so-called ‘Swiss’ bank (although the ‘S’ stands for Swiss, the largest shareholder is actually the Government of Singapore Investment Corporation) announced last month that they wanted to reduce the payroll by 3,500 staff, in order to save $2.53 Billion annually. Seemed like a good idea.
Today we learn that UBS has been stung for $2 Million by a ‘rogue trader’.
Incredible that UBS even knows how much they have lost; if they’re that smart, they could have avoided the problem in the first place.
What odds on board-level resignations?
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