TEXT OF STORY
Doug Krizner: The credit crisis has inflicted more damage on Swiss banking giant UBS. The bank's got to write down an additional $19 billion for bad mortgage investments. Stephen Beard has more from London.
Stephen Beard: For UBS, the red ink never seems to stop. The bank wrote off $18.5 billion last year. Now with this first quarter loss, the total write-down has jumped to almost $40 billion.
The bank is easily the worst European casualty of the credit crisis. Ironic, given the Swiss reputation for caution and prudence.
The problem, says Chris Hughes of the Financial Times, is that UBS waded too far into the market for American mortgage-backed securities.
Chris Hughes: They just went for it more than other European banks, and quite clearly didn't understand the risks they were taking.
The bank is dumping its chairman and tapping shareholders for more cash. Just weeks ago, UBS raised around $13 billion from outside investors. Now, it's looking for another $15 billion.
In London, this is Stephen Beard for Marketplace.
“I think the best compliment I can give is not to say how much your programs have taught me (a ton), but how much Marketplace has motivated me to go out and teach myself.” – Michael in Arlington, VABEFORE YOU GO