UBS should consider splitting its investment bank from the wealth management and Swiss banking businesses, shareholder Knight Vinke Asset Management said.
Bloomberg reports that the 'best owners' of the investment banking arm could be its own employees and management, who are the recipients of the largest part of any profit, Knight Vinke, which is based in New York, said in a letter to UBS staff and shareholders today. The firm said it owns almost 1% of UBS shares.
'We question the merits of keeping the investment bank under the same roof as the wealth management and Swiss banking businesses', Knight Vinke said. 'The investment bank has delivered a good set of results for the first quarter of 2013 but nearly destroyed UBS in 2007-09. Investment banking is a very risky business and these risks pose a serious threat to UBS’ wealth management and Swiss banking franchise'.
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