SWITZERLAND - UBS, the Zurich-based bank, is to close its real estate and securitisation business and cut more jobs, following plans to downsize its fixed-income unit.
The radical restructuring plans, which the company said are designed to increase profitability and simplify the organisational structure, were outlined in an internal memo circulated to employees on 21 January by Carsten Kengeter and Jeff Mayer co-heads of fixed income, currencies and commodities (FICC).
Jerker Johansson, chief executive officer of UBS' investment bank, said: "As announced in October 2008, the investment bank is in the process of reprioritising its business portfolio around client servicing and facilitation while seeking further efficiency gains.
"This week we announced the completion of the organisational structure and the new leadership for our FICC business. These changes will enable us to leverage our core strengths while relying on lower risk and balance sheet utlisation."
The memo, made available to IPE Real Estate, said USB will also exit its municipals, proprietary trading and commodities activities and as a result will be making "further reductions in headcount in the coming weeks".
"This is a necessary albeit difficult action to succeed as a business," it added.
The letter to staff did not specify how many employees faced redundancies, although it did reveal ccommodities head Todd Morakis, credit chief Chris Ryan and interest rates co-heads David Sacco and Sascha Prinz were leaving the company.
No time frame was given for completion of the restructuring plans.
A spokesperson for UBS confirmed the contents of the memo but said the firm was unwilling to comment further.
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