UBS reveals another $19b subprime drama
Swiss bank UBS revealed a second round of subprime-related writedowns of about 19 billion dollars on Tuesday, becoming the world's worst-hit bank in the US mortgage crisis.
The latest writedown was the biggest single subprime hit so far worldwide, and came on top of 18.4 billion dollars (11.7 billion euros) the bank wrote down in 2007.
It will also plunge UBS, the biggest Swiss bank, into a net loss of 12 billion Swiss francs (7.6 billion euros) for the first quarter this year after loss of 4.4 billion Swiss francs in 2007, its first-ever such loss.
The bank also said it wanted to raise 15 billion Swiss francs of new capital, and that it was changing its chairman.
The last writedowns for 2007 had already forced the bank into a controversial rescue recapitalisation by a Singapore sovereign wealth fund and by an unnamed investor in the Middle East.
The overall writedowns by UBS so far of 37.4 billion dollars are far greater than those of American banks Citigroup (21.1 billion dollars in 2007) and Merrill Lynch which has booked 19.4 billion dollars in writedowns.
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