Top Firm Thought Likely To Have To Restructure Again Before Year-End

Oliver Twist

And as many as 3,000 jobs may have to go.

UBS may have to cut another 2,000 to 3,000 jobs as it scales back from capital-intensive businesses, according to a research note by Deutsche Bank AG.

Bloomberg reports that the Swiss bank may have to trim as many as 3,000 jobs by the end of 2013, Matt Spick, a Deutsche Bank analyst, wrote in a note to clients Monday. A small fixed-income and debt capital markets business isn’t practical to maintain with minimal capital behind it, he said.

'We think that most likely UBS will have to restructure again', Spick wrote. The Zurich-based bank will probably be 'back to a pure private client service business plus cash equities plus perhaps some M&A advisory to be a close equivalent to a business like Lazard'.

The UBS share price has outperformed the Eurostoxx Banks Index by around 16% since it announced its last restructuring in October, and Morgan Stanley said in a note at the time that the sweeping changes at the firm 'raised the stakes' for rivals.

One banker told Here Is The City, however: 'UBS has received many plaudits for the way it thought through, and is implementing, the restructuring. It's tough to see where the Deutsche report is coming from on this occasion, and I somewhat doubt we'll see significantly more headcount reductions at the firm this year than have already been announced'.

In the meantime, Reuters reports that British parliamentarians will this week quiz UBS investment banking boss Andrea Orcel, former CEO Marcel Rohner and other past and present executives at the Swiss bank as part of their inquiry into industry standards, following a run of scandals that rocked UBS's London arm.

Past and present executives are set to be asked about standards and culture at UBS. In recent years, the bank has also been hit by a $2.3bn rogue trading loss, massive losses on U.S. sub-prime loans and a damaging tax avoidance row with U.S. authorities.

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