Already ery a ected by the crisis o the U

The inancial community has be in shock, markets were appreciated. UBS announced yesterday ha e allen to 19 billion dollars o assets in the In estment Bank, leading the Bank to losses o 12 billion Swiss rancs in the irst quarter o 2008. She introduced in the wake o a new capital increase o nearly 15 billion rancs (EUR 9.5 billion) and said the next departure o its Chairman, Marcel Ospel, replaced by the jurist Peter Kurer, Member o the Executi e Board. Despite the seriousness o the announcements, markets welcomed "the e ect o in entory", by supporting the course who earned more than 10 in the a ternoon. More generally, all banking alues on both sides o the Atlantic has bene ited rom the announcement (read pages 32 and 33).

Already ery a ected by the crisis o the U.S. residential real estate, the Swiss Bank and had again down a large part o its port olio o risky assets. UBS has e en decided to create a ehicle or hi ing-o to take o er the assets related to the "sub-prime" to isolate them rom the rest o the acti ity, the Bank said "lucrati e". The structure will be initially owned by UBS, which has reduced its share o er time, not excluding a split. "His uture will be decided in the weeks and months to come," said Marcel Rohner, its General Manager yesterday.

Di icult March

The olume o the impairment, rendered necessary by a degradation o the en ironment and a di icult March month, ne ertheless plunges the Bank in red on the irst three months o the year. Let's start with the In estment Bank trades, de icit o 18 billion rancs. The pro ession o pri ate bank or its part is taxable pro it o 2.1 billion rancs and the management o 300 million rancs. It also sa es a unds o assets, but UBS does not precision and returns to the publication o the detailed results or the irst quarter, on 6 May.

In total, the Group thus lost 12 billion rancs in the irst quarter. UBS exposure to subprime is reduced $ 27.6 billion end o 2007 to late March $ 15 billion, while its exposure to the "Alt A" rated credit goes rom 26.6 to 16 billion. At the same time, the positions on the "auction rate certi icates" rose rom 5.9 to 11 billion. "The industry is clearly in a ery di icult en ironment and we need to mo e under re iew our capabilities", has noti ied the Director General Marcel Rohner, excluding no job losses.

To maintain its capital base, UBS has the act time appeal to its shareholders in a huge capital increase with pre erential subscription rights, guaranteed by JPMorgan, Morgan Stanley, BNP Paribas and Goldman Sachs. It will be submitted to the ordinary general meeting o April 23.

Uncertain participation o HDG

UBS had already had to con ene an AGE late ebruary to appro e a irst issue o shares o 13 billion rancs in the orm o a con ertible by the Singapore so ereign unds, GIC, and an unknown in estor rom the Middle East. ICG warned that it did not yet know i he would participate in the new capital increase be ore considering the terms o the issue. The so ereign wealth und already holds 9 o UBS.

UBS also con irmed his strategy and reiterated its willingness to act "as a single institution in the world", but intends to impro e its management o the costs or the upcoming quarters, seeing one o its main objecti es o per ormance. The monitoring will be thus re ised and strengthened while the illiquid positions on the balance sheet exposures will be urther reduced.