On Sunday April 6^th 2008, NZZ am Sonntag is reporting that UBS will be preparing its investment banking division for a possible sale in the next two to three years. To help stabilize its investment banking unit, the bank apparently is planning on cutting up to 3,000 investment banking jobs, mainly in London and New York, while only a few jobs will be lost in Asia and Switzerland, Sonntag reported.

Toomre Capital Markets LLC ("TCM") wonders how much longer UBS will remain a "wanna be" broker/dealer in the global fixed-income capital markets business. Any firm that manages to lose close to $38 billion on an initial position of approximately $400 billion clearly has severe management issues. Equally clearly one has to wonder just how such a major bank allowed itself to get so far off-sides and whether it should be a trusted business partner at all given its extremely poor judgment and utter incompetence. $38 billion in write-downs is just unbelievable!! This week's coming report to the Swiss Central Bank on how the losses came about should make for quite interesting reading.

[UPDATE: The Australian has more information on the departure of UBS Chairman Marcel Ospel. In that article, "Ospel is the best banker in Switzerland by a mile," one UBS executive in London says. "But he was still the guy who sat on the risk committee while everything was ploughed into US mortgages. At its peak our balance sheet was $US 2.3 trillion. It got to a point where $US 400 billion of that was held in US mortgages. John Costas made those decisions and Ospel let him."

If this quote is indeed true, UBS and its former management are even more incompetent than TCM thought before. Why was the UBS investment bank carrying so many mortgages on its books? Were they simply trying to make a significant portion of their profits through a carry trade? Clearly a sense of balance was missing from this bank's collective decision making process.]