UBS Issues Shareholder Report on Write-downs
UBS announced today that it has issued a Shareholder Report detailing the key facts relating to the firm's positions and losses in the U.S. subprime residential mortgage sector through December 31, 2007. This Report, which provides an overview of a report which was submitted earlier to the Swiss Federal Banking Commission (EBK), is available on UBS' website at www.ubs.com/agm.
Amongst other things, the Report summarizes: which businesses were affected by the losses; the business models and growth initiatives pursued in those businesses; how the losses developed in the relevant businesses; the implementation of Risk Management and Risk Control in those businesses; and the key findings related to the causes of the losses.
The Report identifies (and considers the causes of) the losses as originating principally from positions held within three businesses: the (now closed) internal alternative asset management arm, Dillon Read Capital Management (DRCM); the Investment Bank's (IB) Rates business (CDO Warehouse and CDO Super Senior Positions held on the CDO Desk); and the ABS Trading Portfolio managed by the IB's Foreign Exchange/Cash Collateral Trading (FX/CCT) division.
The report filed with the EBK was prepared by UBS's Group General Counsel and Group Internal Audit. They were assisted by U.S. law firm Sullivan and Cromwell LLP, Swiss law firm Homburger AG and PricewaterhouseCoopers.
KPMG Ltd, Zurich, has read the Shareholder Report and the Report to the EBK and determined that, in their professional judgement, the Shareholder Report contains a reasonable summary of the information that UBS included in their report to the EBK.
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