UBS may cut 8,000 jobs

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Zurich: Switzerland's UBS is expected to announce more writedowns and job cuts in the coming days, Swiss newspaper Sonntag reported on Sunday.

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Shares in UBS, the world's largest wealth manager in terms of assets, fell 7 percent on Friday as rumours swirled of a profit warning and more writedowns in the first quarter. The bank, one of Europe's hardest-hit in the crisis, has already written down more than $49 billion since mid-2007.

Sonntag said UBS would write down at least another $2 billion on illiquid assets, including asset categories so far not much in the spotlight such as Credit Linked Obligations (CLOs), the paper said citing people familiar with the matter.

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The Swiss bank giant would also slash another 8,000 jobs, the newspaper said, including some private banking staff.

"This could already be known on April 1," Sonntag said.

UBS declined to comment on the rumours on Friday and was not immediately reachable for comment on Sunday.

UBS has already cut more than 7,000 jobs since the start of the crisis in mid-2007, most of them in investment banking. It said in February another 2,000 jobs would go.

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The Swiss banking icon is struggling to rebuild its once powerful brand after massive investments into risky U.S. assets forced it to accept government backing to survive.

The bank revised up its 2008 net loss to 20.9 billion Swiss francs on March 11 and said its near-term outlook was extremely cautious, warning that its balance sheet remained exposed to illiquid and volatile markets.

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Many expect new Chief Executive Oswald Gruebel, brought in to grapple with UBS's crisis in February after previously turning around Credit Suisse, will choose to get all the bad news out of the way at once, a strategy often termed 'kitchen-sinking'.

"I can well imagine that Oswald Gruebel, like he did during his time at Credit Suisse, will just pack all the negative stuff into the first quarter report to wipe the slate clean for himself," a trader said on Friday, adding that Gruebel could sugar the bitter pill for investors with further job cuts.

Gruebel signalled already on the day of his appointment at the end of February that further cost cuts would be inevitable.

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