Swiss bank UBS has revealed a shock write down from investments in the US subprime mortgage market of almost seven billion euros. UBS, which is Europe's largest bank by assets, says that to cover that it is having to sell stakes to the Singapore government and an unnamed Middle East investor.

UBS's top boss Marcel Ospel explained why they have decided to reveal the losses now: "The situation in the US property market continues to dramatically change for the worse. As a result, we've changed our way of looking at things and came to the conclusion, that this is the right way to go. We needed to provide clarity. We do not want to leave things to speculation because that makes our clients and our employees feel insecure."

Only last month UBS's Chief Financial Officer, Marco Suter, advised analysts and investors in meetings that the bank did not expect to make any huge writedowns in the fourth quarter.

So far UBS is the biggest victim of the sub-prime mortgage meltdown among major European banks, including losses announced earlier, its total is 9.6billion euros. US based Citigroup expects to write off at least 11.5 billion euros for subprime debts. Other big losers include Merrill Lynch, Morgan Stanley and Barclays.

Among British banks, Barclays heads the list, but Lloyds TSB has just said it will take a 275 million euros hit from exposure to credit market problems. And France's Societe Generale also announced 2.9 billion euros of liabilities from investments connected to subprime mortgages.

euronews



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