UBS bank pessimistic about first half of 2012, as profits plummet

Feb 7, 2012, 11:22 GMT

Zurich - Switzerland's biggest bank UBS said Tuesday that uncertainties about the state of the world economy would weigh on its results in the first half of the year, as the bank expected less fresh money from clients and lower trade volumes.

UBS also announced that its net profit dropped 44 per cent to 4.2 billion Swiss francs (4.6 billion dollars) in the last year, which was marked by the European debt crisis and a scandal centering on a rogue trader who lost 2.4 billion dollars.

Operating profit dropped nearly 13 per cent to 27.9 billion francs.

The bank said it plans to cut further costs if its earnings do not improve.

UBS said last year that it would cut 5,500 jobs, to help prevent profits from plummeting even further.

The bank could face legal troubles this year, as authorities in several countries are investigating whether UBS was part of a group of European, US and Japanese banks whose traders manipulated benchmark lending rates in order to profit in trading of financial derivatives.

UBS shares fell 0.68 per cent at the Swiss stock exchange early Tuesday.