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December 10, 2007

So much for canny, parsimonious Swiss bankers

ZURICH, Switzerland (AP) -- UBS AG will write off a further $10 billion in losses from the U.S. subprime lending market, the Swiss bank said Monday, and raise billions in capital through share sales to Singapore and an unidentified investor in the Middle East.

UBS said it will post a loss for the fourth quarter and may now record a loss for the full year as well. That comes on top of the 4.2 billion francs written off in its third quarter, making 14.2 billion francs ($12.6 billion) in writedowns from the subprime crisis by UBS this year.

The Government of Singapore Investment Corp., a sovereign-wealth fund, is investing 11 billion Swiss francs ($9.75 billion), while an undisclosed strategic investor in the Middle East is contributing 2 billion francs ($1.77 billion).

As recently as the middle of November, UBS had predicted a profit for the fourth quarter despite ongoing speculation about its subprime holdings.

Posted by Jay Hancock at 5:28 PM | | Comments (0)
        

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About Jay Hancock
Jay Hancock has been a financial columnist for The Baltimore Sun since 2001. He has also been The Baltimore Sun's diplomatic correspondent in Washington and its chief economics writer. Before moving to Baltimore in 1994 he worked for The Virginian-Pilot of Norfolk and The Daily Press of Newport News.

His columns appear Tuesdays and Sundays.
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