Hundreds more London jobs to go in new cutbacks at UBS

Hundreds more investment banking jobs are to go at UBS's investment banking offices in London as Switzerland's largest bank said it wants to reduce staff by another 2000 or more this year.

The bank, which was bailed out by the Swiss government last year and has cut 9000 jobs since the credit crunch began in 2007, made bigger-than-expected losses last year.

It today said it lost Swfr19.7 billion (£11.3 billion) last year after losing Swfr8.1 billion in the final quarter.

This included a fourth-quarter loss of Swfr3.7 billion on toxic loans and investments, and takes total credit-crunch losses at UBS to more than $50 billion (£33.6 billion).

The bank is transferring more than $39 billion of toxic assets to the newly created Swiss National Bank.

UBS said it would stick with investment banking, but plans to cut its workforce from 17,171 at the end of 2008 to 15,000 by the end of 2009.

With more than 7000 employees based in the UK, London can expect to see several hundred more jobs axed.

Bonuses have been cut by more than 80% and the bank has begun to clawback bonuses already announced, adding: "Some of the accruals made in the first nine months of 2008 were reversed, particularly in the investment bank." That helped cut staff costs for the quarter by 41% to Swfr2.4 billion.

There were net outflows of Swfr58.2 billion from wealth management and Swfr27.6 billion from asset management. But UBS said this was an improvement over earlier quarters.

In a move seen as distancing itself from a US probe into whether the bank helped 20,000 clients avoid tax, UBS set up two new businesses concentrated on its home country.

Chief executive Marcel Rohner said: "We will elevate the profile of the highly profitable and dependable Swiss business.

Conditions for the financial industry have changed, and will remain difficult for the foreseeable future."