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Mar-04-2009UBS Gets New Ammo With Villiger(topic overview)
CONTENTS:
- Former Swiss Finance Minister Kaspar Villiger will replace Peter Kurer as chairman of UBS, completing a top management clearout designed to set the beleaguered bank back on its feet. (More...)
- UBS, the Swiss banking giant enmeshed in a tax scandal in the United States, said Wednesday that its chairman, Peter Kurer, would not seek another year in the post at its annual shareholder meeting next month. (More...)
- Last week, UBS was forced to pay almost $800 million to settle a case that alleged the Swiss bank had conspired to help U.S. clients avoid paying federal taxes. (More...)
- The Group Executive Board's September 2002 members were identified in UBS's Annual Review that year, a public document. (More...)
- The U.S. government has since filed a separate lawsuit to try to force UBS to disclose the identities of 52,000 U.S. customers who allegedly evaded taxes. (More...)
- Two weeks later the bank posts a full-year loss of 4.4 billion Swiss francs. (More...)
- Mr. Birkenfeld, an American citizen who left UBS in 2005, pleaded guilty last June to a conspiracy charge of helping a billionaire American client evade taxes through undeclared offshore accounts. (More...)
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Former Swiss Finance Minister Kaspar Villiger will replace Peter Kurer as chairman of UBS, completing a top management clearout designed to set the beleaguered bank back on its feet. Investors welcomed Wednesdays news, which follows last weeks appointment of former Credit Suisse head Oswald Gruebel as chief executive, as a sign the bank could resolve its tax spat with the United States and restore its reputation as the top banker to the worlds wealthy. [1] ZURICH, March 4 (Reuters) - Heavyweight Swiss politician Kaspar Villiger will replace Peter Kurer as chairman of UBS (UBS.N: Quote, Profile, Research ) (UBSN.VX: Quote, Profile, Research ), completing a top management clearout designed to drag the beleaguered bank out of its deepest ever crisis. Kurer, who was the company's top legal advisor before replacing the discredited Marcel Ospel last year, will leave under a cloud after the bank's shares lost nearly 70 percent of their value under his stewardship. Investors welcomed Wednesday's news, which follows last week's appointment of former Credit Suisse (CSGN.VX: Quote, Profile, Research ) head Oswald Gruebel as chief executive, as a sign the bank could resolve its tax spat with the United States and restore its reputation as the trusted banker to the world's wealthy.[2]
UBS said it nominated Kaspar Villiger, a former Swiss finance minister, as chairman. It is the second change at the top for UBS in a few days. The bank, which also has suffered deep losses from its investments in American subprime securities, recently said that its chief executive, Marcel Rohner, was stepping down this month, to be succeeded by Oswald Grubel, who once led UBS's archrival, Credit Suisse. Mr. Kurer, who became UBS's chairman a year ago, was under increasing pressure, both from investors and local politicians, to leave the firm. He served in top management roles during both the tax and subprime debacles, and was widely seen as a temporary appointment when he became chairman last year.[3] UBS announced today that its chairman, Peter Kurer, will step down after a year in the job just days after the Swiss bank disclosed that its chief executive, Marcel Rohner, will be replaced. The bank said today that Mr Kurer will not stand for re-election and it will nominate Kaspar Villiger, Switzerland's former finance minister, as its new chairman.[4]
ZURICH -(Dow Jones)- UBS AG's (UBS) proposed Chairman and former Swiss finance minister Kaspar Villiger Wednesday said his decision to take over the top job at the embattled Swiss bank was justified, even though he declined repeatedly in the past to join the board of a Swiss bank. Villiger, who needs to be elected by shareholders at the upcoming UBS annual general meeting, said that he decided to join UBS last week and said that he is convinced the bank will turn around with the help of the company's board and its management, naming new Chief Executive Oswald Gruebel, who joined last week. Villiger, 68, said that he will stay at UBS for an "unspecified period of time".[5] ZURICH (Reuters) - UBS ( UBS.N )( UBSN.VX ) chairman Peter Kurer will not stand for re-election, and the board will nominate Kaspar Villiger, a former Swiss finance minister, as a replacement, the Swiss bank said on Wednesday. THOMAS SUTTER, SPOKESMAN FOR INDUSTRY BODY SWISSBANKING: "We think this is a good choice in the current situation for UBS. He knows the mechanisms in the capital Berne as well as those on Zurich's (banking district) Bahnhofstrasse. "At the same time, he is familiar with the important issues for the financial center Switzerland such as banking secrecy from his time as finance minister. "This is a good choice for UBS and for the financial center Switzerland."[6] The bank, facing a U.S. inquisition over providing sanctuary for wealthy U.S. tax dodgers, says former Swiss Finance Minister Kaspar Villiger will succeed Peter Kurer as chairman. Later this morning, a U.S. Senate panel holds a hearing on offshore tax havens and IRS attempts to get names of U.S. clients from UBS. Mark Branson, chief financial officer of UBS Global Wealth Management, is scheduled to testify. Legislators took aim at offshore tax havens in Switzerland, the Cayman Islands and other nations, targeting them for shutdown with bills introduced by Democrats in both chambers of Congress.[7]
"The bank looks much stronger now, it has a strong CEO (Gruebel) and a chairman untainted by the tax investigation," Vontobel analyst Teresa Nielsen said. Kurer held the post of chairman for less that a year, during which UBS shares lost nearly 70 percent of their value, the bank was rescued by the government and it became embroiled in a U.S. tax probe that threatens Swiss banking secrecy. Villiger looked relaxed and glad to be back in the limelight at a press conference on Wednesday, in contrast to the downbeat Kurer sitting alongside, and said his political experience could help in UBS's tax row with the United States. "You never know what your career will bring," he said. "I know of course that I have to have a lot of respect for this job." As finance minister, Villiger was a staunch defender of bank secrecy, now a controversial topic after UBS agreed to pay a $780 million (553 million pound) fine and disclose the identity of about 300 of its U.S. clients to avert criminal charges.[8] Kaspar Villiger, former finance minister for the Swiss Federal Council, who will stand for office as UBS chariman in succession to Kurer next month. You cannot blame the Swiss government for wanting someone with a political background to keep an eye on their investment, given the Swiss franc has been weakened by the support provided to UBS. If this leads to a blurring of the lines between the private and the public sectors, so be it. For its part, UBS needs someone with political experience to fight its corner, given that tax authorities around the world are putting its offshore clients under pressure. In this respect, Villiger's credentials are impeccable. He was a member of government when the Swiss banks had to agree a $1.25m settlement with Holocaust victims who alleged they had been hoarding Nazi wealth. He has enacted some of the strictest legislation against money laundering in the entire world. He has also been a staunch defender of the traditio of bank secrecy in Switzerland. You cannot read too much into day-to-day movements in bank shares these days.[9]
From 1989 to 2003 Kaspar Villiger was a member of the Swiss Federal Council, and in the last 8 years, as Finance Minister. During his time in public service, the Federal Council took crucial decisions, such as enacting legislation against money laundering, initiating a supervisorybody for financial markets and finalizing the EU Directive on the Taxation of Savings Income, aimed at strengtheningthe Swiss financial market. These steps are now key ingredients of the competitiveness of the Swiss Confederation. "Kaspar Villiger has had a distinguished career in public service, where his leadership capabilities and integrity have earned him high respect. He brings substantial experience as a businessman and as a member of boards of multinational corporations," said Gabrielle Kaufmann-Kohler, chairman of the governance and nominating committee of the Board. "The Board believes that his presence and contribution will send a clear signal and will prove valuable at a time when the bank is working to renew its commitment to all stakeholders to seek to maintain high standards of credibility, reliability, and sustainable performance. We are grateful to Kaspar Villiger for having accepted this challenging position." Kaspar Villiger said, "I believe these to be exceptional times for UBS and Switzerland, and I recognize the difficulties that still lie ahead. This is precisely why I have accepted to chair the Board of UBS, out of a sense of service to this country and its people.[10] Kaspar Villiger has been nominated as a potential successor to Kurer. Kurer explained that he had achieved, through working with the Board of Directors and Group Executive Board, the majority of the targets he had aimed at when first elected one year ago. Vice chairman Sergio Marchionne has paid tribute to the outgoing chairman, stating that Kurer deserves both credit and recognition for putting UBS back on the right track after recent difficulties caused by the worldwide financial crisis. His proposed replacement, Kaspar Villiger, served on the Swiss Federal Council for over 10 years, including an eight year stint as Finance Minister. Should he be confirmed as the new chairman it would be the second very senior change to personnel in less than a week. On 26 February UBS announced its CEO, Marcel Rohner, had resigned and was being replaced with immediate effect by Oswald J. Gr''bel.[11] The UBS Board of Directors is nominating Kaspar Villiger as a candidate for the role of Chairman. "One year ago I accepted the position of Chairman out of my sense of responsibility for the bank, its shareholders, clients, staff and the communities in which we work," said Peter Kurer, Chairman of the UBS Board of Directors. "At that time, I announced that we had to resolve numerous and challenging issues: the establishment of proper governance to reflect the rapid changes in the financial marketplace; a re-examination of the bank's strategy; the implementation of improved risk control systems; the reduction of risk concentration and the balance sheet; the introduction of responsible and long-term, value-oriented incentive plans; and succession planning designed to enhance the best leadership of the organization going forward. Most of this has been accomplished in a short period of time by working closely with the Group Executive Board and the Board of Directors. I am particularly proud of having secured someone with the experience and talent of Oswald J. Grbel as Group Chief Executive Officer after Marcel Rohner advised us of his intention to leave the bank. I now think it is time to complete this transition and leave the office at the end of my one-year term."[10]
Oppenheim analyst Javier Lodeiro said. He rates UBS at buy with a CHF22 target. Analysts said the political and diplomatic skills of Villiger will dovetail with those of Gruebel, known as a terse communicator and quick decision-maker, and who is expected to slash jobs and restructure more vigorously than his predecessor, Rohner. Villiger acknowledged the influence of Gruebel, whom Villiger said encouraged him to take the chairman's post, saying the two will meet weekly and share an "intense, interactive" cooperation. Shares in UBS, down 31% this year compared with a 32% fall in the Stoxx Europe 600 bank index, rose on the news. At 1419 GMT, they were up CHF0.36, or 3.6%, to CHF10.25. Villiger, who cited "a sense of service" to Switzerland and its people as his reason for accepting the job and proposed 850,000 Swiss francs ($720,339) as an annual salary, will quit board seats at insurer Swiss Reinsurance Co. (RUKN.VX) and Nestle SA (NESN.VX) if elected. "I believe these to be exceptional times for UBS and Switzerland, and I recognize the difficulties that still lie ahead," Villiger said. The appointment of Kurer, formerly UBS' chief general counsel, one year ago was almost immediately met with skepticism by shareholders and the Swiss public, mainly because of lack of banking experience but also because of what detractors said was his close association with long-standing former UBS chairman Marcel Ospel.[12] The Internal Revenue Service, the U.S. government's tax collection agency, is trying to pry from UBS the names of as many as 52,000 wealthy Americans who have accounts with UBS. The bank maintains that turning over the account names would violate Swiss banking secrecy law. Villiger's nomination comes after UBS last week appointed Oswald Gruebel — a former CEO at crosstown rival Credit Suisse — as its new chief executive to replace Marcel Rohner. Villiger said in a statement he would relinquish his membership in the boards of Nestle, Swiss Re and daily Neue Zuercher Zeitung, which he has held since 2004.[13] "Villiger can certainly help to rebuild trust into UBS, particularly in the U.S.," Pelli added. Before the bank's problems with U.S. tax authorities escalated last month, its biggest concerns were the huge losses it posted on ill-fated investments in exotic investment banking products. These losses forced the bank last fall to seek government help to shore up capital, and resulted in mounting pressure from Swiss politicians on Kurer and former Chief Executive Marcel Rohner to resign. Both men had already been with UBS when the losses were incurred. The new chairman said at a news conference that he only decided to accept the post after UBS had appointed Oswald Gruebel as CEO last Thursday. "When UBS approached first approached me, my answer was a definite no," he said. "But when UBS came back after a few weeks and told me that Gruebel will become CEO, I was revisiting my decision, because I came to the conclusion that with this man the task could be done." Villiger said he accepted the post Saturday.[14]
Villiger at first glance seems to make up for what UBS' new chief executive, Oswald Gruebel, lacks. With eight years as finance minister during his 14 years as a member of the Swiss Federal Council, Villiger will give UBS the political and international connections it needs to deal with the new looming threat from U.S. tax authorities to its wealth-management division. UBS' hopes of building its private banking platform have been challenged by developments in the United States.[15]
Villiger served as a member of the Swiss Federal Council from 1989 to 2003, and most recently as finance minister. Kurer's resignation follows the announcement last week that UBS named Oswald Gruebel as its new group CEO, succeeding Marcel Rohner.[16]
The switch comes after UBS (nyse: UBS - news - people ) appointed Oswald Gruebel last week as its new chief executive to replace Marcel Rohner. Villiger said in a statement released by the bank Wednesday that he would relinquish his membership in the boards of Nestle (other-otc: NSRGY.PK - news - people ) and Swiss Re.[17] The need for a clean break with the past was an important factor in the management change, analysts said. "Mr Villiger has a good background - he has been involved in legislation against money laundering and has international political connections. This will distance the bank from the ongoing tax investigation," said Javier Lodiero at Oppenheimer. Last month, the bank appointed Oswald Gruebel, the former head of Credit Suisse, as its new chief executive, replacing Marcel Rohner.[18] Thursday, in a surprise move, UBS said that former Credit Suisse Group (CS) Chief Executive Oswald Gruebel would replace Marcel Rohner as CEO of UBS with immediate effect. Kurer said he was leaving after the bank's completion of changes to its operations, such as slashing risk-taking and putting more emphasis on its core private banking arm, which caters to wealthy individuals.[12]
U.S. authorities are still demanding that UBS, and Swiss private banks in general, give up client names a move that would risk destroying the industry. Kurer and Rohner were only in their jobs for 12 and 18 months respectively, although both were long-term UBS employees. Neither of them was at the helm of the bank when it built positions in the sub-prime market that ultimately led to U.S. announcing the largest corporate loss in Swiss history in 2008 (SFr19 billion), writing down over $50 billion is assets and hiving off $60 billion of non-performing securities into a government-supported fund. Both were closely associated with the discredited regime of former chairman Marcel Ospel and chief executive Peter Wuffli. As former head of wealth management (Rohner) and group legal counsel (Kurer), they were also implicated in the U.S. court case. Kurer and Rohner carried out a swift reorganisation of UBS's businesses, principal among them splitting wealth management, investment banking and asset management into three standalone business units, a move that was largely well received by the international investment community. They were on a hiding to nothing in their home market, where many Swiss are bitter and angry at the tarnishing of a brand name long synonymous with the country itself.[19] Mr. Kurer joined UBS in 2001 as general counsel and was appointed to the banker-heavy Group Executive Board in July 2002. He became chairman of the UBS board of directors last April. Mr. Birkenfeld's March 2006 letter said he notified UBS compliance and legal officers of 'unfair and deceptive business practices' at the bank, but they ignored his complaints for three months. He then went over their heads to their superior, General Counsel Kurer, in an attempt to get them addressed. Copies of Mr. Kurer's letter were sent to senior UBS audit executives and Marcel Rohner, head of the bank's global wealth management business who became UBS chief executive until his resignation last week.[20] Mr. Kurer, now 59, joined UBS in 2001 as group general counsel and was appointed to the banker-heavy Group Executive Board in July 2002. He became chairman of the board of directors last April. Another member of the 2002 panel, who had been appointed that July, Marcel Rohner, rose to become UBS chief executive officer. He resigned last week. Mr. Kurer said last week that Mr. Rohner told the board of directors in January that he wanted to step down following some internal restructuring.[21]
Villiger was a Swiss finance minister for some eight years from the late 1990s. Kurer is stepping down just a week after Oscar Gruebel, a former executive at rival Credit Suisse, was appointed its Chief Executive Officer, following the departure of Marcel Rohner. "I now think it is time to complete this transition and leave the office at the end of my one-year term," said Kurer.[22] The new management team now comprises Villiger, the Swiss finance minister from 1995 to 2003, and Ossie Grbel, the former chief executive of Credit Suisse, who has replaced Rohner. The appointments of Villiger and Grbel, both safe pairs of hands and pillars of the Swiss establishment, show three things. UBS believes it has still not done enough to prevent outflows from its core wealth management business, which has lost assets of close to SFr150 billion in the past 12 months.[19] Vidya Ram, 03.04.09, 08:40 AM EST Swiss bank's new chairman will be a former government finance minister. As UBS prepares for battle with American tax authorities, it's bringing out the big guns. The Swiss bank's board is nominating a former government finance minister to be its chairman, not long after bringing on the man credited with turning around Credit Suisse as its new chief executive.[15] ZURICH -(Dow Jones)- The Swiss finance ministry Wednesday welcomed the appointment of Kaspar Villiger as chairman of UBS AG (UBS), saying the former finance minister and a newly-appointed chief executive are an ideal team to reorient the Zurich-based bank. "It is positive that the board is proposing a very experienced person who has made his name outside UBS and the banking sector, and thus marks more than a symbolic break with the past," the finance department said in a statement to Dow Jones Newswires.[23] ZURICH (Reuters) - UBS chairman Peter Kurer will not stand for re-election and the board will nominate Kaspar Villiger, a former Swiss finance minister, as a replacement, the Swiss bank said on Wednesday.[24] ZURICH (AFP) — Beleaguered Swiss bank UBS on Wednesday saw the departure of another top management figure, disclosing that chairman Peter Kurer will not seek re-election and that former Swiss finance minister Kaspar Villiger has been picked as a replacement.[25]
March 4 (Reuters) - UBS ( UBSN.VX ) ( UBS.N ) chairman Peter Kurer is stepping down and the bank will nominate Kaspar Villiger, a former Swiss finance minister, to replace him. May 3, 2007 -- UBS shocks investors by closing its Dillon Read hedge fund unit, which had a reputation as a serial outperformer, after it posted lower-than-expected results.[26] ZURICH -(Dow Jones)- UBS AG's (UBS) outgoing Chairman Peter Kurer said there was no political pressure involved in the Chairman nomination of former Swiss finance minister Kaspar Villiger.[27] Peter Kurer will not stand for re-election as chairman of the UBS board of directors at its AGM on 15 April 2009. The UBS board of directors is nominating Swiss Finance Minister, Kaspar Villiger, as a candidate for the role of chairman in his stead.[28]
"Peter Kurer was a member of the bank's leadership team during the time when the mistakes that led to UBS's current situation were made; replacing him was therefore a logical step," Fulvio Pelli, president of the Free Democratic party, told Swiss national radio. "I am very happy that UBS found a new chairman who isn't part of the culture that led to the difficulties in which the bank is currently in," he added. Villiger is seen as a good choice because of his experience, his diplomatic skills and wide-ranging network in politics and finance. "Villiger was a very good finance minister, and he is the one who anchored Swiss banking secrecy laws in international negotiations and agreements, said Christoph Darbellay, president of the Christian Democrats.[14] Peter Kurer's proposed successor as chairman of UBS, Kaspar Villiger, should know a thing or two about Swiss banking secrecy, an issue that has caused considerable friction with the U.S. Government, which believes the bank is being used by clients for tax evasion purposes.[29] Peter Kurer, left, outgoing chairman of the board of Swiss bank UBS, and his successor Kaspar Villiger, right, answer journalists questions during a press conference in Zurich, Switzerland, Wednesday, March 4, 2009.[30] Peter Kurer, chairman of embattled Swiss banking giant UBS, said Wednesday he would not seek reelection and the board of directors would nominate Kaspar Villiger to replace him.[22] Swiss banking giant UBS ( UBS Quote - Cramer on UBS - Stock Picks ) said Wednesday Chairman Peter Kurer won't stand for re-election and Kaspar Villiger has been nominated as Kurer's successor.[16]
UBS AG says former Swiss president Kaspar Villiger will replace Peter Kurer as chairman of the board next month.[17]
Switzerland''s biggest bank UBS announced on Wednesday, that former Swiss Finance Minister Villiger will replace Kurer as chairman of the board next month.[30] UBS has an age limit of 70 years. Outgoing Chairman Peter Kurer said that this can be changed. Although not a learned banker - he studied engineering and led his family's company before becoming a cabinet member in 1989 - Villiger said that his experience as a finance minister for Switzerland puts him in a good position to lead the bank.[5] The 68-year-old Villiger was born in central Switzerland and was a member of Switzerlands governing Federal Council for 15 years. He served two one-year terms as the countrys president, a largely ceremonial role. He was finance minister when UBS was formed through the merger of UBS Union Bank of Switzerland and Swiss Bank Corporation (SBC) and also when Swiss banks agreed a $1.25 billion settlement in 1998 with Holocaust victims who alleged banks has hoarded their wealth. That topic caused much soul-searching in Switzerland about the neutral countrys role in World War II. The banks initially resisted Jewish and U.S. pressure, after survivors complained that the banks refused to give back their money, demanding death certificates for people who perished in Adolf Hitlers death camps, but eventually had to give in.[1] Kaspar Villiger was nominated for election to the UBS Board of Directors and proposed as its Chairman on 4 March 2009. He served as a member of the Swiss Federal Council for 15 years, first as Minister of the Swiss Federal Department of Defense and then as Minister of the Swiss Federal Department of Finance from 1995 to 2003. He was President of the Swiss Confederation in 1995 and 2002. Villiger began his political career in 1972 when he was elected to the council of the canton of Lucerne as a member of the Free Democratic Party (FDP) of Switzerland. In 1982 he was elected to the National Council and to the Council of States in 1987. He retired from politics in 2003, after which he joined the boards of directors at Swiss Re, Nestl and the Neue Zrcher Zeitung. He is a member of the Global Leadership Foundation, an organization which promotes good governance around the world.[10] Bank Helvea analyst Peter Thorne said that Villiger brought "complementary political and diplomatic skills" to that of Kruebel's business and banking experience. Villiger said in a press conference he was "confident" that the bank would find a solution to the U.S. probe but said he would only give details after he is elected. He accepted the bank's nomination as these are "exceptional times for UBS and Switzerland, and I recognize the difficulties that still lie ahead." "This is precisely why I have accepted to chair the board of UBS, out of a sense of service to this country and its people," he said. Since retiring from politics in 2003, he has been a board member of food giant Nestle, reinsurer Swiss Re and newspaper firm Neue Zuercher Zeitung. He would resign from these positions if elected to head UBS.[25] After stepping down from politics in 2003, Villager became a board director at Nestl'' and Swiss Re. If elected chairman at UBS, he will forego these roles, according to the bank. Gabrielle Kaufmann-Kohler, chairman of the governance and nominating committee of the board at UBS, said: "The board believes that his presence and contribution will send a clear signal and will prove valuable at a time when the bank is working to renew its commitment to all stakeholders to seek to maintain high standards of credibility, reliability, and sustainable performance. Villiger added: '''I believe these to be exceptional times for UBS and Switzerland, and I recognise the difficulties that still lie ahead. This is precisely why I have accepted to chair the board of UBS, out of a sense of service to this country and its people.[29]
"The government wasn't involved. there was no political pressure", Kurer said during a press conference in Zurich. Kurer also said he doesn't expect a personal indictment from the U.S., where the bank is under pressure from regulators who alleged that UBS helped clients avoid taxes. Villiger, who stressed that his acceptance of the top job wasn't due to career considerations, said he didn't accept UBS's salary proposal. He said he will propose the board to receive an annual salary of about 850,000 Swiss francs, or $720,000, in line with the salary of a top banker at the Swiss National Bank. "This is a personal decision and it's not a signal for other members of UBS or future Chairmen", Villiger said.[27] After UBS agreed to pay a $780.0 million fine and hand over the details of a number of clients (250 according to Swiss reports), to settle a probe into tax fraud, the U.S. Inland Revenue Service is now demanding that the bank hand over the details of 52,000 U.S. citizens with UBS bank accounts, putting Switzerland's famed secrecy laws to a big test. Before entering politics in 1972 with Switzerland's Free Democratic Party, he studied mechanical engineering at the Swiss Federal Institute of Mechanical Engineering and ran Villiger Soehne, a family-owned firm that produced cigars.[15] The whole sordid business has become very public, and very un-Swiss-bankish. Villiger will have to deal with the scandalous allegation that USB kept its clients' financial information secret. Given that secrecy is perhaps the biggest marketing plank of Swiss banking, he may find it hard to distance UBS from the political fallout. Perhaps the best he can do is keep secret the details of any deal the bank makes with U.S. authorities. Switzerland's top justice official met with her U.S. counterparts and said the Obama administration is not interested in escalating a dispute with Switzerland over bank secrecy laws.[7] Under Villiger's tenure, Switzerland reached an agreement with the European Union to impose a withholding tax on interest-rate income from savings on accounts held in Switzerland and transfer the proceeds to tax authorities of the accountholders country of residence. During that time, he coined his probably pithiest and most memorable quote, when he said that "Swiss banking secrecy is not negotiable." This notion has certainly changed in the weeks since UBS was forced to hand over data to U.S. authorities data on around 250 clients suspected of having committed tax fraud to avoid an indictment.[14]
The bank posted a full-year loss of 19.7 billion francs, the biggest in Swiss corporate history. The bank also is involved in a dispute with U.S. tax collectors as they have slapped the bank with a lawsuit seeking the identities of tens of thousands of clients who kept billions of dollars in assets at the bank to dodge the IRS. An official of UBS, Mark Branson, on Wednesday will face questions from a Senate panel for the first time since UBS acknowledged responsibility for helping its American clients hide assets from the U.S. government.[16] The world's biggest banker to the rich was one of the first to be hit by sub-prime woes, as a disastrous expansion into investment banking forced it to write down $49 billion (£33 billion). It has since transferred $40 billion in toxic assets to a fund run by the Swiss National Bank and received a SwFr6 billion (£3.6 billion) injection of fresh equity from the Swiss Government in return for a 9.3 per cent stake. It has also emerged that UBS will face questions from a Senate panel after acknowledging responsibility for helping tens of thousands of American clients to hide assets from the U.S. Government.[4]
Nov. 12 -- Raoul Weil, head of UBS AG's wealth management business, is charged with conspiring to help thousands of wealthy Americans hide $20 billion of assets from U.S. tax authorities in Swiss bank accounts.[26] June 19 -- A former UBS banker who once smuggled a client's diamonds into the United States in a toothpaste tube pleads guilty to helping a billionaire hide $200 million in assets from U.S. tax authorities, part of a broader tax evasion probe of UBS. Aug. 12 -- UBS says it will separate its wealth management business from investment banking, acknowledging flaws in its one-bank strategy.[26]
The U.S. Department of Justice alleged that the UBS Group Executive Board that ran the Swiss bank's daily business operations contributed to a conspiracy to defraud the United States of tax revenue.[21] The Group Executive Board was headed six years ago by the then-president of the company, Peter Wuffli, who left UBS in 2007. He was appointed board president in December 2001, the Handbook said. The most senior UBS executive to be charged to date is Raoul Weil, who headed the bank's oversight of its U.S. cross-border business and was appointed to the Group Executive Board in 2005. He was indicted by a U.S. grand jury in November. He has been declared by the court to be a fugitive.[21]
ZURICH -(Dow Jones)- UBS AG (UBS) Wednesday reiterated denials that outgoing Chairman Peter Kurer knew of wrongdoing in the Zurich-based bank's U.S. offshore business, which catered to wealthy Americans.[31] In the most direct evidence yet tying UBS Chairman Peter Kurer to oversight failures at the Swiss bank, InvestmentNews learned today that the U.S. Justice Department recently criticized as inadequate an internal investigation that he supervised.[20] ZURICH -- UBS AG said Wednesday embattled Chairman Peter Kurer will step down in favor of a former member of Switzerland's governing cabinet at the Swiss bank's April 15 shareholder meeting.[32] Peter Kurer bowed to the inevitable on Wednesday, saying he would not seek re-election as chairman of UBS at the Swiss bank'''s shareholders''' meeting next month.[33]
The silver-haired 68-year-old will take over as chairman from Peter Kurer and partner new Chief Executive Oswald Gruebel to rebuild the confidence, reputation and profitability of the troubled Swiss banking titan. His appointment "will send a clear sign that a leader with sufficient knowledge, expertise and negotiation skills will be at the top of the bank," Kepler Capital Markets analyst Mathias Bueeler said.[34] In a surprise move last week, UBS appointed former Credit Suisse Group (CS) CEO Oswald Gruebel as CEO. Villiger, who is to replace current chairman Peter Kurer in April, and Gruebel are seen as an ideal team to reorient UBS, the finance ministry said.[23]
The moves were made in reaction to some $50 billion in write-downs related to the credit crisis. "I now think it is time to complete this transition and leave the office at the end of my one-year term," Kurer said in a statement. The entrance of Swiss-born Villiger, 68, a member of the country's seven-person governing Cabinet from 1989 to 2003, during most of which time he served as finance minister, is linked to the hiring of Gruebel as CEO. Villiger initially turned down an offer late last year to chair UBS, but revisited his decision after Gruebel's appointment.[12] And, UBS directors have nominated former Swiss finance minister, Kaspar Villiger, 68, as Kurer's replacement. From 2004 until now, Villiger was on the board of Swiss Re and Nestle but, if elected, he will resign from those positions.[35] UBS announced today that it plans to appoint Kaspar Villiger, a former Swiss finance minister, as its next chairman.[19] ZURICH, March 4 (Reuters) - Former Swiss Finance Minister Kaspar Villiger is the kind of safe and experienced political operator unhappy UBS (UBSN.VX: Quote, Profile, Research )(UBS.N: Quote, Profile, Research ) investors have been looking for.[34]
The main battle now is centered on Swiss bank secrecy, which is likely to be a political firestorm for years. That makes Kaspar Villiger, the country's former finance minister, look right for the job.[36] Just as Grübel brought the right credentials to further reshape UBS, Villiger arrives with a political pedigree suitable for the bank's next frontier. The Swiss establishment is fighting a multi-fronted battle against attacks on bank secrecy, a vault already cracked by the U.S. Villiger was Swiss finance minister when the country last faced such intense scrutiny.[36]
Villiger, who was Switzerland's finance minister between 1995 and 2003, is a staunch defender of Swiss banking secrecy. As finance minister, he resisted headwinds to lift Swiss secrecy laws amid a storm over Switzerland's role in the second World War and claims by Jewish groups against Swiss banks for assets that were withheld from Holocaust victims and their families. Towards the later part of his term in office, Swiss banking secrecy came under scrutiny again over terrorism financing.[25] The 68 year-old was a member of the Swiss Cabinet from 1989 to 2003 and held the country's rotating one-year presidency in 1995 and 2002. During his eight-year term as finance minister until 2003, Mr. Villiger finalized an accord with the European Union in which Switzerland, not part of the EU, agreed to tax the savings EU citizens put in Swiss bank accounts, The Associated Press reported. Mr. Villiger said he accepted the chair "out of a sense of service to this country and its people." "We need to respond to the current challenges by relying on our core values of integrity, hard work and reliability," he said.[3] "Today's announcement had been expected, and a number of potential successors had been named in the press. "Given Villiger's good reputation in Switzerland when serving in public service, his leadership experience and his work done as a finance minister including enacting legislation against money-laundering and finalizing the EU directive on the taxation of savings income, the proposal will send a clear sign that a leader with sufficient knowledge, expertise and negotiation skills will be at the top of the bank that is challenged by specific problems and a changing framework for Swiss banks."[6] Villager, who will stand for election as Kurer's successor at the annual general meeting, was born February 5, 1941 in Pfeffikon in central Switzerland. He studied engineering at Zurich's science and technology university ETH, and in February 1989 was elected to the Swiss Federal Council as part of the Free Democratic Party. Following his election, he joined the Federal Military Department, where he stayed until 1995. In 1996, he joined the Federal Department of Finance as finance minister, a role he kept for eight years. He was elected president of the Confederation both in 1995 and 2002. During Villager's time in public service, he led the enaction of legislation against money laundering, and helped initiate a new supervisory body for financial markets and finalised the EU Directive on the taxation of savings income. Speaking in 2002 at the Foreign Policy Association in New York, Villager said: "Switzerland, which serves as a headquarters for several globally operating financial concerns, is fully aware of its great responsibility with regard to stability risks.[29]
Kurer, who many considered a temporary appointment when tapped last year, came under increasing pressure as U.S. tax authorities accused UBS of aggressive cloak-and-dagger tactics to attract wealthy American clients allegedly evading taxes. Although Switzerland's financial services authority FINMA said Kurer did not know details of UBS' client strategies in the U.S., many Swiss politicians and experts urged that he resign.[13]
ZURICH -(Dow Jones)- Switzerland's financial regulator Wednesday said it supports UBS AG's (UBS) planned appointment of a former Swiss finance minister as its chairman, saying the move is a further step in stabilizing the Zurich-based bank.[37] Earlier Wednesday, UBS proposed former Swiss finance minister Villiger for election as chairman at the bank's April 15 shareholder meeting. Company Web site: www.swissre.com -By Katharina Bart, Dow Jones Newswires; +41 43 443 8043; [email protected] (Goran Mijuk contributed to this story.)[38]
Mr Kurer, who stepped into the breach last year to replace Marcel Ospel, will be succeeded by Kaspar Villiger, a former Swiss finance minister and elder statesman.[33] Peter Kurer will be replaced by former Swiss finance minister Kaspar Villiger, in a move that has been widely welcomed by the markets.[18]
UBS, the Swiss banking giant enmeshed in a tax scandal in the United States, said Wednesday that its chairman, Peter Kurer, would not seek another year in the post at its annual shareholder meeting next month. [3] The departure of Peter Kurer as chairman of UBS was a racing certainty following its $780m settlement with the U.S. authorities over alleged tax evasion by its clients.[9]
Kurer was also dogged by a U.S. probe into allegations of tax evasion against the company, which UBS settled recently through a deferred prosecution and $780 million fine. When the bank admitted it had made mistakes, some experts questioned Kurer's claim that he knew nothing of the wrongdoing, since as chief lawyer at the time he was UBS' point person for all potential legal problems.[12] "No new documents nor facts have been announced or have emerged since the completion of Finma's investigations and the announcement of the agreements UBS entered into with U.S. authorities on 18 February," UBS said in a statement, referring to the Swiss regulator Finma's finding that senior bank management did not know of the wrongdoing. In its online edition Wednesday, Swiss daily Neue Zuercher Zeitung reported Kurer, then UBS' chief lawyer, may not have initiated a thorough enough internal probe after receiving a letter from whistle-blower Bradley Birkenfeld, a former Geneva-based UBS private banker.[31] Birkenfeld later cooperated with U.S. justice authorities, who recently reached a deferred prosecution agreement with UBS. In a statement, the bank said Birkenfeld's 2006 letter to UBS executives immediately sparked an internal investigation and remedial measures within the bank. "However, this investigation did not uncover the extent of wrongdoing, which the U.S. justice authorities' and UBS' own probes in 2008 show," the bank said, echoing U.S. Department of Justice comments made when the settlement was disclosed. The press report's assertions against Kurer come shortly after he disclosed plans to leave the bank in April.[31]
The IRS sued UBS last month for the names of as many as 52,000 Americans with secret offshore accounts. The Swiss bank turned over 250 names as part of its settlement of the criminal investigation but is resisting the release of any more. UBS, the largest Swiss bank, acknowledged in its settlement that it schemed to defraud the U.S. by helping American citizens evade U.S. taxes from 2000 to 2007. Some UBS executives who knew of the illegal conduct 'continued to operate and expand the United States cross-border business because of its profitability,' the bank said in the agreement.[21]
Mr. Kurer, a Swiss citizen who received legal training at the University of Chicago, commented in a Feb. 18 UBS statement announcing the settlement. 'UBS sincerely regrets the compliance failures in its U.S. cross-border business that have been identified by the various government investigations in Switzerland and the U.S., as well as our own internal review,' he said, in a statement.[21]
The new chairman's experience in international talks about Switzerland's banking secrecy laws will come in handy, given that one of UBS' biggest problems is the pressure it is facing from U.S. authorities to hand over details of more than 52,000 accountholders. Disclosing such details would violate Swiss law, while the risk that Swiss secrecy laws will be loosened is already spooking investors at UBS and other private banks.[14] UBS lost 19.7bn Swiss francs ($16.7; '11.9) in 2008, largely because of the U.S. sub-prime mortgage crisis that sparked the global economic downturn. Mr Kurer said that he had set out to reduce the bank's levels of risk and rethink its longer term strategy. We think this is very good news.[18] Oct. 16 -- UBS announces it is to get 6 billion Swiss francs from the Swiss government for a 9.3 percent stake and is to unload $60 billion of toxic assets into a new central bank fund.[26] The change of chairman at UBS marks the move of the Swiss bank from rescue mode to turnaround. Having written down tens of billions of dollars of assets and after receiving tens of billions more in new capital from shareholders, sovereign wealth funds and the Swiss government, the bank now faces the task of re-establishing its investment bank.[39] UBS, the largest Swiss bank, has been hardest hit in Europe by the financial crisis and has taken a massive writedown on investments in bad assets, about 40 billion dollars of which were transferred late last year to a troubled asset fund as part of a bailout deal reached with the government and central bank.[22]
The Swiss National Bank launched a fund for toxic UBS assets, which the central bank said lost nearly $1.7 billion by the end of 2008.[1]
The Internal Revenue Service is attempting to uncover the names of 52,000 clients who hold accounts with UBS. Last month, UBS agreed to pay $780 million in fines and restitution for conspiring to help American citizens violate their country's tax laws by hiding assets, estimated to be worth at least $14.8 billion, from the U.S. Government.[4] UBS, Switzerland's biggest bank, has been haunted by a U.S. investigation that accused it of helping wealthy Americans illegally evade $200 billion (SFr235 billion) in taxes.[40]
Kurer will leave April 15 after one year on the job, during which Switzerland's largest bank reported record losses and was faced with U.S. allegations that it helped Americans evade taxes. "One year ago I accepted the position of chairman out of my sense of responsibility for the bank, its shareholders, clients, staff and the communities in which we work," Kurer said in a statement. "I now think it is time to complete this transition and leave the office at the end of my one-year term."[13] Kurer will leave April 15 after one year in the job during which the Swiss bank reported record losses and became embroiled in a major U.S. tax evasion probe.[17] The bank said that Kurer would leave on April 15 after one year in the job during which UBS reported record losses and became embroiled in a major tax evasion probe in the United States.[30]
"I now think that it is time to complete this transition and leave the office at the end of my one-year term," he said. While Mr Kurer is not being blamed for the bank's heavy losses, he has come under scrutiny in the light of allegations that UBS helped wealthy U.S. citizens evade tax, given his previous position as the bank's chief legal officer.[18] Kurer, formerly the bank's chief legal officer, became chairman a year ago after Marcel Ospel stepped down amid the bank's mounting losses. Kurer said most of the tasks he set out to achieve, including the reduction of risks and reexamination of the bank's strategy, "have been accomplished" and that it was "time to complete this transition and leave the office."[25]
Villiger will replace Peter Kurer in April. UBS has now lost its two most senior executives in the space of a week, following the resignation of previous chief executive Marcel Rohner on February 26.[19] A UBS spokeswoman said Kurer deserved credit for introducing structural reforms at UBS and persuading Oswald Gr''bel to replace Marcel Rohner as chief executive.[9]
The latest change comes barely a week after the bank's chief executive Marcel Rohner resigned and was replaced by former Credit Suisse chief executive Oswald Gruebel. It gave a boost to the share price, which opened up 3.34 percent at 10.22 Swiss francs.[25] The bank has had to dump US$40 billion of bad loans and has been bailed out by the Swiss government to the tune of US$3 billion. Last week its share price sank to a record low and chief executive Marcel Rohner resigned suddenly.[41]
Kurer's decision not to seek re-election, and Villiger's nomination to be chairman, come only days after Oswald Grübel displaced Marcel Rohner as chief executive.[36]
Last week, UBS announced that Oswald Grübel, the former chief at arch-rival, Credit Suisse, will replace Mr Rohner as chief executive.[4]
We need to respond to the current challenges by relying on our core values of integrity, hard work and reliability. I believe that I can contribute to the re-establishment of these values. In taking on this task, I am comforted by the fact that the bank has a Board of Directors composed of competent and committed individuals as well as a strong executive leadership, with the newly appointed CEO, Oswald J. Grbel." If elected, Kaspar Villiger will resign all corporate positions he presently holds in order to devote all of his energy to serving UBS.[10] "The finance ministry welcomes the nomination of former federal council member Villiger for the position of chairman at UBS. "As a former executive politician and entrepreneur one can be confident that he will manage to get the bank in calmer waters and regain trust." "It's positive that the board is proposing a very experienced personality, who has gained merits outside the banking world.[6] Villiger is a member of the boards of the worlds largest food group Nestle and reinsurer Swiss Re and will resign all other corporate positions if elected chairman, UBS said. "Villiger has a good background, he has been involved in legislation against money laundering and he has international political connections. UBSs troubles were such that it accepted a 6-billion-franc shot in the arm from the Swiss government in October.[1] ZURICH -(Dow Jones)- Incoming UBS AG (UBS) Chairman Kaspar Villiger Wednesday defended his role as a board member of reinsurer Swiss Reinsurance Co. (RUKN.VX), which needs fresh capital to mend its battered balance sheet after major investment write-downs.[38]
Shares in UBS rose 3.64 percent to 10.25 Swiss francs ($8.73) on the Zurich exchange. Villiger headed his cigar producing company Villiger Sons AG from 1966 to 1972. UBS board member Gabrielle Kaufmann-Kohler said Villiger's "leadership capabilities and integrity have earned him high respect." "He brings substantial experience as a businessman and as a member of boards of multinational corporations," she said in a statement.[13]
In a statement Wednesday, UBS said Mr. Kurer "deserves a lot of credit and recognition for having helped put UBS back on track." Mr. Kurer said in the statement that he believed many of the goals he set a year ago had been achieved, including putting new risk controls in place and establishing "proper governance." Mr. Villiger said in a statement he would relinquish his membership in the boards of Nestle, Swiss Re and daily Neue Zuercher Zeitung, which he has held since 2004.[3] "What happened at Swiss Re is extremely unpleasant," said Villiger, who sits on the Zurich-based company's finance and risk committee as well as one devoted to governance, together with Swiss Re vice-chairman Walter Kielholz. While Villiger said he contemplated whether Swiss Re's foray into more sophisticated financial products was faulty, the reinsurer's board had acted quickly with personnel changes and fresh capital amid a full-year loss of CHF864 million.[38]
Nicolas Michellod, senior analyst at financial research firm Celent, said Mr. Kurer's announcement to step down was expected. "Mr. Villiger represents the optimal profile in the eyes of the Swiss tax payers and politicians," he told The Associated Press. "He combines an interesting professional experience at the highest level of the Swiss political system and a great career as manager of his company."[3]
Villiger is ideally suited to smoothing ruffled feathers in Switzerland's political establishment, senior Celent analyst Nicolas Michellod said. In an unusually strongly worded statement, the Finance Ministry, which spearheaded a shore-up of UBS in October, welcomed Villiger's appointment, saying he and Gruebel make an ideal team to reorient UBS. Villiger, who doesn't have broad banking and business experience some investors had hoped for, is likely to cede more ground on determining UBS strategy to Gruebel as the two attempt to return UBS to profitability after a streak of quarterly losses. "I think Oswald Gruebel will increasingly have more freedom, and will be able to assert his influence not only operationally but also strategically," Sal.[12] The announced nomination of Villiger comes as Mark Branson, the firm's chief financial officer of global wealth management and business banking, prepares to testify before the Senate today over allegations that UBS helped wealthy American clients to evade billions of dollars in taxes by setting up offshore accounts.[35] Rio Tinto shareholders are warming to the miner's proposed $19.5 billion tie up with China's top aluminium maker Chinalco, Chief Executive Tom Albanese said. Royal Bank of Scotland said it plans to sell the retail and commercial banking businesses of newly acquired ABN AMRO China, part of efforts to exit from these operations in Asia. U.S. Hartford Financial Services Group is in talks to sell most of its life insurance unit to Canadian Sun Life Financial Inc, Bloomberg reported, citing three people with knowledge of the matter.[7] Israeli flavors and fine ingredients maker Frutarom Industries Ltd said it agreed to acquire the U.S. company Flavors Specialties Inc (FSI) for $17.2 million. South Africa's fourth-biggest bank Nedbank said it is in talks to buy Old Mutual Group's interests in certain joint ventures in exchange for its shares. Australian coal seam gas firm Arrow Energy is considering its position in relation to its stake in and bid for rival Pure Energy Resources Ltd after Pure shareholder Royal Dutch Shell decided to sell to a rival bidder.[7]
Last week, UBS was forced to pay almost $800 million to settle a case that alleged the Swiss bank had conspired to help U.S. clients avoid paying federal taxes. [19] The finance ministry's opinion has become increasingly prominent after an October shore-up for UBS as well as the handover of confidential client data to U.S. authorities two weeks ago, mandated by the Swiss banking regulator.[23] The chairman of Swiss banking giant UBS will step down after just one year in the job - a year in which the bank reported record losses from bad loans.[18] Troubled Swiss banking giant UBS could be the next big international investment bank to pull out of the New Zealand market. It is understood from several sources that UBS is close to withdrawing from New Zealand and that its workings will be taken over by local management but in a considerably downsized form.[41]
Shares in UBS, the world's largest wealth manager in terms of assets, rose 3.6 percent to 10.25 Swiss francs by 10:44 a.m., ahead of the European banking sector.SX7P. The stock had gained more than 15 percent after news of Gruebel's appointment.[8] Feb. 20 -- Warns that it could go out of business if it complies with an order to reveal names of thousands of suspected U.S. tax dodgers with secret offshore accounts at the bank. Feb 23 -- Shares fall to a new all-time low below 10 Swiss francs after criticism over its handling of a U.S. tax probe.[26] Kurer set an early standard for restructuring the industry's perverse one-way pay schemes and took the first step to getting the bank past a destabilising U.S. tax prosecution. He dismantled the dysfunctional corporate governance regime established.[36]
Peter Kurer deserves a lot of credit and recognition for having helped put UBS back on track. With humility and courage, he accepted this engagement out of a sense of duty and service to the institution. He has worked tirelessly to accomplish all the objectives he had set for himself and for the bank at the beginning of his tenure. The Board of Directors thanks him for all of his efforts and for having guided the organization wisely over the last 12 months."[10] Another day, another top executive resignation from UBS. Peter Kurer, the firm's chairman, has announced that he won't stand for re-election when the board meets next month.[35] Peter Kurer, chairman of the UBS Board of Directors, has indicated that he will not be standing for re-election.[11]
Shareholders back an $11.9 billion capital injection from Singapore and an unidentified Middle East investor. April 1 -- UBS doubles its writedowns, dumps its chairman, Marcel Ospel, and seeks more emergency capital. It proposes its lawyer, Peter Kurer, as Ospel's successor.[42] UBS Chairman Peter Kurer sat on a high-level 2002 corporate committee accused by U.S. prosecutors last month of 'knowingly' withholding information relating to its obligations to report on American taxpayers' secret accounts, according to a recently released federal document.[21] UBS AG has stated that Chairman Peter Kurer will step down after a year in office.[43] Deputy chairman Sergio Macrchionne said: "Peter Kurer deserves a lot of credit and recognition for having helped put UBS back on track." UBS badly needs to move forward from the problems of the last year, and Kurer signalled his willingness to step aside some weeks back.[9]
For one thing, Kurer happened to be group general counsel at UBS after 2001, relevant to the period under investigation. There was no attempt by the U.S. authorities to link him to the allegations, but there was a degree of pressure on UBS to get him to step aside. Contingency plans to replace him were put into place towards the end of last year. For another, Kurer presided over a decline in the UBS share price of 70% during the period of less than a year in which he served as chairman.[9]
The Justice Department did not identify Mr. Kurer, then a senior company lawyer, or the nine other members of the Group Executive Board by name. Its accusations were leveled at UBS and unnamed executives who 'occupied positions at the highest levels of management' and were termed 'unindicted co-conspirators.' It did not say if any unindicted co-conspirators were on the Group Executive Board.[21] On the 2002 panel was John Fraser, head of the bank's global asset management, who remains on the Group Executive Board. He was appointed in late 2001, according to UBS's 2002/2003 Handbook, also a public document.[21]
The allegation is contained in a single paragraph of an 11-page exhibit attached to the bank's settlement of a U.S. criminal investigation filed with the court last month. 'Executives on UBS's executive board knowingly' failed to tell the Internal Revenue Service in Sept. 2002 of an internal audit showing deficiencies in UBS's implementation of its tax oversight obligations, prosecutors alleged.[21] The 2006 investigation focused on whistleblower allegations that bank managers were encouraging breaches of UBS's own written policies in helping American clients evade federal taxes, prosecutors said in an exhibit accompanying UBS's settlement of a criminal investigation. This 'limited' 2006 probe 'did not examine or follow up on available evidence of private banker communications with U.S. clients,' according to the Justice Department's Statement of Facts attached to the settlement.[20]
The bank was required under an agreement with the U.S. to report and withhold taxes on American clients, according to the exhibit, a document that constitutes a written accusation of crimes signed by prosecutors.[21]
In February, the bank provided tax data on up to 300 clients to the U.S. government and paid a fine of 780 million dollars to settle a case in which it was accused of abetting tax fraud by U.S. clients.[25] The IRS has filed a separate civil suit seeking to force the company to disclose the identities of U.S. taxpayers involved in the case. 'If I were advising the individuals who served on that committee, I'd tell them to be concerned that the U.S. Government might bring charges,' George Clarke, a Washington criminal tax lawyer who represents clients with offshore accounts.[21]
The deal has not completely satisfied the U.S. tax authorities, who have demanded secret data on 52,000 further UBS clients.[40] UBS has been struggling to recover after losing billions in the U.S. subprime home loan crisis and the ensuing financial meltdown. It is also caught up in a legal dispute with the United States over a tax evasion probe.[25] Later on Wednesday, a UBS official will be quizzed by the U.S. Senate about the bank's role in a tax evasion inquiry.[18]
The impact on UBS has been significant," Sergio Marchionne, Vice Chairman of the bank, said in a statement. Villiger said he accepted the nomination "out of a sense of service to this country and its people."[22] The announcement that retired Swiss politician Kaspar Villiger would replace Mr. Kurer marks the second major change atop the Swiss bank in less than a week.[32] Kaspar Villiger will be replacing Peter Kurer at the bank's annual meeting in April.[15]
Swiss politician Kasper Villiger will replace Kurer at the bank'''s shareholder meeting on April 15.[43] Villiger also said that once "I am elected, I (won't be) a political president". He said that the bank will need a clear political framework within which it can work in quiet. Villiger, who said he has the backing of the entire board, said he will resign from his other board posts, that include Swiss Reinsurance Co. (RUKN.VX) and Nestle SA (NESN.VX).[5] Villiger held firm to secrecy laws and dealt with critics by pushing through legislation against money laundering. Bank Vontobel analyst Teresa Nielsen noted: "Villiger has the right political links in Switzerland and also to a certain extent outside Switzerland -- this may help in all the tax discussions ahead."[25]
Gruebel s in charge, the team has been replaced so that is a positive." "This is very good news. It will put some of the reputation issues behind UBS, bring confidence to the company and restore its reputation. "Villiger has a good background, he has been involved in legislation against money laundering and he has international political connections.[24] "The new CEO Gruebel and the new chairman Villiger are seen as an ideal team for the reorientation of UBS." "Everyone expected Kurer to go, and it's good that the uncertainty is over. His replacement is a politician of some standing in Switzerland.[6]
The completion of that task now falls to Villiger and Grbel. Both Kurer and Rohner should be commended for managing their departures in a classy fashion that shames many of their counterparts in the global banking industry. They were thrust unexpectedly into the most difficult of roles, and worked tirelessly for limited reward, at times in the face of great hostility, to save the institution they worked for. They both clearly realised they could not be the people to take UBS forward in the longer term. If Villiger and Grbel finish what they started, history will look more kindly on Kurer and Rohner than many of their countrymen currently do.[19] Wednesday, UBS reiterated that neither Kurer nor former CEO Rohner knew of fraudulent UBS offshore schemes to aid clients avoid taxes. Kurer, who is 59, said he will leave UBS altogether at the end of April, after two-week handover to Villiger following the shareholder meeting.[12]
The measures taken over the past 12 months undoubtedly leave UBS better placed to survive as a business. Kurer and Rohner have not been able to complete the task of restoring trust, profitability and stability which Rohner said, in his last major interview as CEO, were key to UBS’s revival.[19] Under the tenure of Mr Kurer and Mr Rohner, UBS reported the biggest loss in Switzerland's corporate history and cut thousands of jobs as part of a company-wide restructure.[4]
The changes at Switzerland's biggest bank come about as it was reported in February that net withdrawals at UBS reached 226 billion francs ($193 billion) in 2008, compared with inflows of 140.6 billion francs the previous year.[16] Oct. 1 -- UBS warns a 4 billion Swiss franc subprime hit would cause a third-quarter pretax loss. A few weeks later, UBS reports a quarterly loss of 726 million Swiss francs, its first quarterly loss in nine years. Jan. 30, 2008 -- UBS announces another writedown, this time for $4 billion.[42]
UBS posted a record annual loss of about 17 billion dollars for 2008, the largest full-year loss in Swiss corporate history.[25]
Today's 4% hike in the UBS share price suggests the Swiss bank is starting to make the right moves.[9] The Swiss bank's general counsel was installed as chairman last year, in anticipation - correctly, as it turned out - of a legal onslaught.[36]
Villiger's predecessor, Kurer, had himself stepped in to replace the unpopular Chairman Marcel Ospel last year.[15]
As finance minister for the Swiss Federal Council, Villiger enacted some of the strictest legislation focused on rooting out money laundering in the world.[29] Under Villiger's reign as finance minister, Switzerland introduced the current savings tax regime with the European Union and introduced strict money laundering rules.[5]
Shareholders will vote on the nomination at the firm's annual general meeting on April 15. In a statement, Villiger said: I believe these to be exceptional times for UBS and Switzerland, and I recognize the difficulties that still lie ahead.[35] "UBS needs to reengineer trust", Villiger said, adding that the bank's main problem was that it has lost a lot of goodwill in the past.[5] Broking industry sources say it will exit New Zealand and a group of local managers will form a partnership to run a significantly smaller equities, research and investment bank business in New Zealand with affiliation arrangements with UBS.[41] A UBS spokesperson in Sydney said the bank was firmly committed to remaining in New Zealand. If UBS does leave it will be the third major international investment bank/brokerage firm to pull out this year.[41]
In January, U.S. bank Citigroup said it would use First NZ Capital to trade shares in New Zealand.[41]
In February 2007 Doggett and Levin, along with the then senator Barack Obama, introduced the Stop Tax Haven Abuse Act, comprehensive legislation to stop offshore tax haven and tax shelter abuses. They cited $100 billion in revenue drained from the U.S. Treasury at the expense of "honest, hardworking American families who pay their fair share".[40] U.S. Treasury Secretary Timothy Geithner warned that the cost of shoring up U.S. banks may surpass the $700 bi.[1]
The Justice Department criticism was part of a section titled 'inadequate compliance systems.' Mr. Kurer, 59, was UBS's top lawyer at the time. UBS's $780 million settlement, which headed off a likely indictment, limits the bank's exposure to prosecution but not that of its employees.[20] The panel was appointed and overseen by the company's board of directors. UBS's $780 million settlement, which headed off a likely indictment, limits the bank's exposure to prosecution but not that of its employees.[21]
The Group Executive Board's September 2002 members were identified in UBS's Annual Review that year, a public document. [21] Columbia University law professor Daniel Richman, a former federal prosecutor, said 2002 Group Executive Board members could be in U.S. cross-hairs. 'This is an indication that the government believes it has clear evidence with respect to individuals on that board, and that they could be charged,' he said.[21]
The U.S. government has since filed a separate lawsuit to try to force UBS to disclose the identities of 52,000 U.S. customers who allegedly evaded taxes. [25] As part of a deal, the U.S. Justice Department agreed to defer criminal prosecution of UBS in exchange for the payment of fines and restitution, and the names of up to 300 U.S. clients.[4] Last month UBS agreed to pay $780 million in fines and restitution and handed over the names of 300 clients involved in the scheme, but the Internal Revenue Service is seeking an additional 52,000 client names. UBS is fighting the IRS over the release of those additional names.[35]
Sergio Marchionne, Vice Chairman of UBS said, "No one could have reasonably foreseen the extent and speed of deterioration of market conditions affecting the financial services industry.[10]
Peter Kurer deserves a lot of credit and recognition for having helped put UBS back on track."[28] The government would ultimately hold a roughly 9% stake in UBS after a convertible note linked to the aid package is converted to shares, though the government has said it wants to dispose the asset before that happens and has promised not to interfere in the running of UBS.[23] May 6 -- UBS says it will axe 5,500 jobs and sell billions of dollars of ailing assets in a bid to break free from the subprime crisis.[42]
Two weeks later the bank posts a full-year loss of 4.4 billion Swiss francs. [42] The bank still needs to do more to win back the trust of Swiss politicians and the public. Third, the Swiss national authorities remain deeply concerned about the challenges facing its private banking industry.[19]
The Swiss should simply pay the fine, decamp from the U.S. (yes, shut down shop !), and NOT hand over the names of the other 52000 clients. Otherwise Switzerland is finished asthe French, German & UK Govts will be next in line, asking the Swiss to hand over more names.[4] In February Swiss Re replaced former CEO Jacques Aigrain with Stefan Lippe, and tapped U.S. billionaire Warren Buffet's Berkshire Hathaway (BRKB) for fresh funds.[38]
Feb. 10, 2009 -- Posts the biggest ever annual loss for a Swiss company, but says client withdrawals reversed in January. It says it will axe 2,000 more jobs as it restructures to focus on wealth management.[26] Mr Kurer will be replaced by Mr Villiger in April. "We think this is very good news. It will bring confidence to the company and restore its reputation," said Teresa Nielsen at Vontobel.[18] The bank now hopes that shareholders in April will approve the nomination of political heavyweight Villiger, 68, to head the bank.[25] "The bank looks much stronger now, it has a strong CEO (Gruebel) and a chairman untainted by the tax investigation."[24] Kurer's accomplishments were many and swift. He shrunk UBS's balance sheet, risk appetite and investment bank.[36] "In 2001, Switzerland was one of the first industrialised countries and the first significant financial centre to participate in the Financial Sector Assessment Program of the IMF and World Bank. It was a tough but insightful test.[29]
Mr. Birkenfeld, an American citizen who left UBS in 2005, pleaded guilty last June to a conspiracy charge of helping a billionaire American client evade taxes through undeclared offshore accounts. [20]
SOURCES
1. Former FinMin Villiger to succeed as UBS chairman - International Herald Tribune
2. UPDATE 7-UBS taps former FinMin Villiger as new chairman | Markets | US Markets | Reuters
3. UBS Chairman Kurer to Step Down - DealBook Blog - NYTimes.com
4. UBS chairman to step down after one year - Times Online
5. UBS's Villiger Convinced UBS Can Be Turned Around - EasyBourse actualit'
6. INSTANT VIEW: Reactions to chairman change at UBS | Reuters
7. DealZone » Blog Archive » Banking on Politics | Blogs |
8. Former FinMin Villiger to succeed as UBS chairman | Reuters
9. Kurer fulfills his destiny
10. Peter Kurer Will Not Stand for Re-Election as Chairman of the UBS Board of Directors
11. New chairman nominated at UBS
12. 3rd UPDATE: UBS Chairman Kurer Exits; Swiss Ex-Politician Tapped - EasyBourse actualit'
13. The Associated Press: UBS taps former Swiss president as new chairman
14. UBS New Chairman Will Have To Rebuild Trust, Politicians Say - EasyBourse actualit'
15. UBS Gets New Ammo With Villiger - Forbes.com
16. UBS Chairman Kurer to Resign | Banks | Financial Articles & Investing News | TheStreet.com
17. UBS replaces Peter Kurer as chairman of the board - Forbes.com
18. BBC NEWS | Business | UBS boss replaced after one year
19. New UBS chairman shows the battle for Swiss banking is far from over /Euromoney magazine
20. Justice Dept. chastises UBS chairman over IRS fraud probe - InvestmentNews
21. UBS chairman may be tied to alleged IRS fraud - InvestmentNews
22. Kurer to step down as UBS chairman | Visitbulgaria.info
23. Dow Jones Deutschland: Swiss Fin Ministry Sees New UBS Chairman
24. INSTANT VIEW - UBS names new chairman | Reuters
25. AFP: Troubled Swiss bank UBS picks new chairman
26. TIMELINE-UBS chairman steps down | Deals | Regulatory News | Reuters
27. UPDATE: UBS Chairman:"No Political Pressure" In Board,CEO Nomination - EasyBourse actualit'
28. Investment Week - Kurer to step down as UBS chairman -
29. Profile: The new UBS chairman Kaspar Villiger
30. Switzerland UBS ''' Suomenkuvalehti.fi
31. UBS Repeats Denials Chairman Kurer Knew Of US Offshore Wrongdoing - EasyBourse actualit'
32. UBS Chairman to Step Down - WSJ.com
33. FT.com / Companies / Banks - UBS chairman Kurer to step down
34. NEWSMAKER-UBS entrusts Villiger with rebuilding reputation | Markets | US Markets | Reuters
35. UBS Chairman to Step Down; Successor Nominated
36. UBS's new chairman Kaspar Villiger will bank fight new battles - Telegraph
37. Dow Jones Deutschland: Swiss Financial Regulator Lauds UBS Appt As Stabilization
38. Incoming UBS Chairman Defends Swiss Re Board Role After 08 Net Loss - EasyBourse actualit'
39. Comment: No more 'ostrichology' for UBS
40. swissinfo - News Digest- swissinfo
41. UBS may be next to quit NZ | Stuff.co.nz
42. TIMELINE-UBS chairman steps down | Markets | US Markets | Reuters
43. UBS Chairman Steps Down - Global Custodian
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