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  #21  
Old 15.12.2007, 19:22
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Re: Yet more sub-prime UBS woes another $10bn writedown....

Can the shareholders somehow get rid of this obviously incapable UBS boss?
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  #22  
Old 15.12.2007, 19:33
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Re: Yet more sub-prime UBS woes another $10bn writedown....

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I don't think UBS are about to go bust any time soon.... So your money is probably about as safe as it can be.


On the subject though - does anyone know if there's a banking compensation scheme in Switzerland similar to the one mandated by the UK FSC for banks operating in the UK? There, you'll get the first 35k of your cash bank if the bank goes bust (subject to the fund having enough money to meet compensation claims).
Thanks. I guess my $9.85465 million will be safe with UBS
Btw I remember reading somewhere that it's safer to store money with Kantonal banks. Is it so or was I hallucinating?
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  #23  
Old 15.12.2007, 20:10
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Re: Yet more sub-prime UBS woes another $10bn writedown....

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Reputation is suffering but the underlying bank is solid (and presently supported by the Wimbies).
Sorry, but Google fails me on this one. What are "Wimbies"?
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  #24  
Old 15.12.2007, 22:22
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Re: Yet more sub-prime UBS woes another $10bn writedown....

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Sorry, but Google fails me on this one. What are "Wimbies"?
WM&BB. Wealth Management and Business Banking

Middle east money, far east money, russian money all looking for a home...
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  #25  
Old 15.12.2007, 23:35
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Re: Yet more sub-prime UBS woes another $10bn writedown....

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WM&BB. Wealth Management and Business Banking

Middle east money, far east money, russian money all looking for a home...
Thank you. (re-reads Lob's post and now can put it into context.)
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  #26  
Old 16.12.2007, 23:40
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Re: Yet more sub-prime UBS woes another $10bn writedown....

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Btw I remember reading somewhere that it's safer to store money with Kantonal banks. Is it so or was I hallucinating?
From: http://en.wikipedia.org/wiki/Cantonal_bank
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Cantonal banks (German: Kantonalbank, French: Banque Cantonale, Italian: Banca Cantonale) are Swiss governmental-owned commercial banks, that use the canton that they are based in as guarantee for the assets held there. However, currently they are in process of being partially privatised.
I've always understood cantonal banks to be among the safest banks in the world because they are guaranteed/backed by the relevant canton. I guess you would need to contact your local cantonal bank and see to what extent they have been privatised and how they are guaranteed by the cantonal, or possibly federal, government?
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  #27  
Old 16.12.2007, 23:52
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Re: Yet more sub-prime UBS woes another $10bn writedown....

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From: http://en.wikipedia.org/wiki/Cantonal_bank


I've always understood cantonal banks to be among the safest banks in the world because they are guaranteed/backed by the relevant canton. I guess you would need to contact your local cantonal bank and see to what extent they have been privatised and how they are guaranteed by the cantonal, or possibly federal, government?
Cantonal banks are not guaranteed by the Confederation. Canton guarantee is not a guarantee of sound business practices either - witness BCV's and BCG's problems.
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  #28  
Old 17.12.2007, 00:00
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Re: Yet more sub-prime UBS woes another $10bn writedown....

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Cantonal banks are not guaranteed by the Confederation. Canton guarantee is not a guarantee of sound business practices either - witness BCV's and BCG's problems.
It must be a guarantee that you get your money back, though?

Is there any form of confederational deposit guarantee in general?

Pardon my ignorance, but what happened to BCV and BCG - I heard a few years ago that a few cantonal banks go into some kind of trouble and needed to be semi-privatised to be bailed out, or is this something more recent?
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  #29  
Old 17.12.2007, 10:26
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Re: Yet more sub-prime UBS woes another $10bn writedown....

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It must be a guarantee that you get your money back, though?
Conditional yes, to the extent that the canton's finances and politics can support it... see below.

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Is there any form of confederational deposit guarantee in general?
The confederation does not guarantee bank deposits in any way shape or form. Nor should it in my opinion.

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Pardon my ignorance, but what happened to BCV and BCG - I heard a few years ago that a few cantonal banks go into some kind of trouble and needed to be semi-privatised to be bailed out, or is this something more recent?
The BCV had CHF 381 millions in losses in 01, and up to a staggering 1.2 billion losses in 02 mostly due to non-performing loans. They had to be bailed out by Canton Vaud.

The BCGe had a portfolio of NPLs worth about 5 billion CHF in 2000. These had to be stripped from the bank's balance sheet and transferred to a separate foundation to be sold progressively on the market, with the state coughing up for the losses. Had this not been done, the bank would have had to file for bankruptcy.

The losses are estimated to have been about 2.7 billion - foundation running costs and financing interests for the 5 billion advance nonwithstanding... as the foundation was founded by a 5 billion advance from the BCGe on which the canton had to pay interest... thank you taxpayers.

The canton has also had to inject emergency funds in the BCGe capital to cover for provisions and capital adjustment to the tune of 318 million CHF.
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  #30  
Old 17.12.2007, 18:21
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Re: Yet more sub-prime UBS woes another $10bn writedown....

In theory, yes because public companies belong to their shareholders. In practice, this is quite difficult, especially as UBS' board seems to be acquiesing to his wishes. In my opinion, the chairman's job was wobblier before he managed to get the Singapore government fund to plow in 11 billion SFr, effectively shoring up UBS. I don't think big US investment funds, which make up the biggest chunk of UBS' shareholders, are too bothered about kicking the chairman out.

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Can the shareholders somehow get rid of this obviously incapable UBS boss?
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  #31  
Old 20.12.2007, 15:56
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Re: Yet more sub-prime UBS woes another $10bn writedown....

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  #32  
Old 20.12.2007, 18:03
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Re: Yet more sub-prime UBS woes another $10bn writedown....

Even when they get it right, they manage to get it disastrously wrong to the tune of billions of dollars:

http://www.bbc.co.uk/blogs/thereport...commentsanchor


My conclusion, We're all f*****d.
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  #33  
Old 20.12.2007, 20:11
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Re: Yet more sub-prime UBS woes another $10bn writedown....

You may be getting your wish - at least for a better explanation to shareholders - although the US and UK shareholders would have to get on the bandwagon to actually get anything done:

http://www.nytimes.com/reuters/busin...reholders.html

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Can the shareholders somehow get rid of this obviously incapable UBS boss?
Incidentally, I would've linked a Swissinfo story about this had I found one - the above is a NYT story sourced to Reuters, so I'm not sure how long the link will work.
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  #34  
Old 20.12.2007, 20:17
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Re: Yet more sub-prime UBS woes another $10bn writedown....

Leader from the Economist:
http://www.economist.com/opinion/dis...ry_id=10334574

Not pleasant reading...
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  #35  
Old 24.12.2007, 15:25
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Re: Yet more sub-prime UBS woes another $10bn writedown....

Looks like UBS are going to be facing a probe by the Swiss banking regulator following the huge sub-prime losses:

http://news.bbc.co.uk/1/hi/business/7158805.stm

Switzerland's Federal Banking Commission (EBK) is to investigate how UBS became one of the banking sector's worst victims of the credit crunch. The Swiss bank has been forced to write off about $14bn (£7bn) because it owned debt linked to US mortgages.
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  #36  
Old 06.01.2008, 10:35
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Re: Yet more sub-prime UBS woes another $10bn writedown....

http://www.google.com/search?q=define:moral%20hazard

"Arises when people behave recklessly because they know they will be saved if things go wrong."

Banking is a classical moral hazard. The political cost of a bank failure is so high (especially as they might cascade) that governments almost have to bail them out, and this is reflected in the nature of banking insurance schemes.

So why not take risks with other peoples money, when they can't really be hurt anyway as society-at-large will just swallow the inevitable losses?

Fixing it is hard. You probably need a complete alternative to the current monetary system. Re-connecting loans to deposits and ending the fractional reserve seems like a good start. For the more adventurous systems like Ripple start to look attractive.

It's fancy though .... after using the Chinese/Arabs to fund a lavish and cheap lifestyle, Americans (and Europeans, to a lesser extent) have now managed to use the Chinese/Arabs to fund a massive binge of home ownership as well!
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  #37  
Old 06.01.2008, 14:14
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Re: Yet more sub-prime UBS woes another $10bn writedown....

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http://www.google.com/search?q=define:moral%20hazard

"Arises when people behave recklessly because they know they will be saved if things go wrong."

Banking is a classical moral hazard. The political cost of a bank failure is so high (especially as they might cascade) that governments almost have to bail them out, and this is reflected in the nature of banking insurance schemes.

So why not take risks with other peoples money, when they can't really be hurt anyway as society-at-large will just swallow the inevitable losses?

Fixing it is hard. You probably need a complete alternative to the current monetary system. Re-connecting loans to deposits and ending the fractional reserve seems like a good start. For the more adventurous systems like Ripple start to look attractive.

It's fancy though .... after using the Chinese/Arabs to fund a lavish and cheap lifestyle, Americans (and Europeans, to a lesser extent) have now managed to use the Chinese/Arabs to fund a massive binge of home ownership as well!
If you look at the some of the biggest sub-prime losers so far (Citi, UBS and Merrill Lynch) they've had to sell substantial parts of their business to Middle and Far Eastern concerns though.... I reckon those in the East supplying our oil and cheap manufactured goods will end up owning a great deal of 'our' Western assets because of the greed of our banks and ever-borrowing consumers.

But I agree with you about the cavalier attitude in the financial sector. Many have got rich out of new 'financial instruments' designed to circumvent banking regulations in the last 4 or 5 years. Now that their bets have gone bad they are relying on the state to bail them out: Privatise profits, nationalise losses.

Thus we all end up bailing out their business, either through taxpayer cash or from inflation eroding the value of our salaries and savings. It's pretty disgusting IMO and I'd hope that we'd see some people held to account as well as more stringent policing of the financial markets but I can't see that happening.
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  #38  
Old 06.01.2008, 15:37
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Re: Yet more sub-prime UBS woes another $10bn writedown....

& here comes Credit Suisse with more "good" news

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Credit Suisse Group expects additional writedowns of 2.5 billion Swiss francs ($2.3 billion) for the fourth quarter of 2007, Sonntag reported without saying where it got the information.
Source Bloomberg
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  #39  
Old 06.01.2008, 16:11
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Re: Yet more sub-prime UBS woes another $10bn writedown....

Question:
Why everybody is complaining about ubs and other banks instead of looking at the US system of lending money?
If I have to blame someone, I would blame the guys who lent money to anyone.
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  #40  
Old 06.01.2008, 16:14
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Re: Yet more sub-prime UBS woes another $10bn writedown....

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Question:
Why everybody is complaining about ubs and other banks instead of looking at the US system of lending money?
If I have to blame someone, I would blame the guys who lent money to anyone.
because this is a forum about Switzerland & UBS / CS are Swiss banks ...

agree, all the big investment banks & high street players (Northern Rock) have been caught out on this one, but its global greed & not just a US problem, but a global one.
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