A View From Middle England - Conservative with a slight libertarian touch - For Christian charity and traditional belief - Free Enterprise NOT Covert Corporatism

Sunday, September 18, 2011

UBS now puts loss at $2.3 billion

See no evil hear no evil - that's my motto!
I can't understand how bosses stay in place even when catastrophe is all around them. It never occurs to them to ask pertinent questions. In fact most never ask anything it seems so that if anything untoward hits the office fans they can say they knew nowt. The latest dimwitted boss is Oswald Gruebel who told a Swiss newspaper he would not resign as chief of UBS bank over the rogue trading business. "I'm responsible for everything that happens at the bank," Mr Gruebel told Swiss Sunday newspaper, der Sonntag. "If you ask me whether I feel guilty, then I would say no." Of course he doesn't feel guilty. He knows nothing so he can't feel guilty can he?

This is the bank that hired the services of Maureen Miskovic as chief risk officer. She had previously been at Lehman Brothers, which of course went down the tubes spectacularly. Ms Miskovic took over risk assessing at UBS at the start of the year. She arrived from US based financial services group State Street with a strong reputation and had been seen to shake up risk management at the bank. But she was unaware of this disaster until Kweku Adoboli owned up.

I think the problem is that we're dealing with two totally different types of people. On the one hand there is the group in which Gruebel and Miskovic thrive and then there's the techy wiz kiddy group that gets an adrenalin type rush at the thought of gambling with vast sums of cash. I couldn't do it. I find it hard enough not to press the wrong buttons when ordering train tickets online. I can hardly imagine what Adoboli was thinking when his loss hit the $2 billion mark.

But it must be a bit similar to gamblers in Las Vegas. Don't losers always think that another roll of the dice will bring them fortune? What's so different about the two forms of gambling? We should have a Rogue Traders Anonymous and a Blinkered Bank Bosses Anonymous.

UBS say the losses only related to trading positions taken on in the last three months. However, the police say it's three years. Will a court case give us the real truth of what went on? We've got a whole load of nonsense surrounding News Corporation. Will UBS be any better?

Going back to Herr Gruebel. He should hang his head in shame. His responsibilities amount to nothing, it would appear. For starters he's got a crap risk assessment system on his hands. It's a total disgrace for a chief executive to be so detached from reality.


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