LyrArc Article Gist
Testifying at Southwark Crown Court in London, UBS trader Adoboli said: "I absolutely lost control. I was no longer in control of the decisions around the trades we were doing... My ability to think rationally and deeply was gone." The trades led to losses of $2.3 billion for UBS.

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UBS interim CEO Ermotti's career in investment banking and efforts to move UBS away from investment banking.

LyrArc Article Gist
UBS presents the losses at the London trading desk as a result of a rogue trading scandal. Stewart points to the culture a the UBS's investment banking operation that is partly responsible. Investment bankers he has talked to at UBS say there is a culture at UBS that encourages individuals to work separately in isolation from others, to make their own deals for advancement, a sort of every person for himself. There is no emphasis on team effort and thinking of the bank first.

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Oswald Grubel, CEO of Swiss bank UBS, resigned on Sept. 14, 2011, after the loss of $2.3 billion in irregular trades made at its London trading desk.

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Systemic risks from "too big to fail" and the pushback on capital reserve requirements that leave banks with lower reserves. Ewing describes the role of the president of the Swiss Central Bank, Mr Hildebrand, in setting rules for higher capital reserves for Swiss banks than that of other countries and the pushback from the banks resisting the new regulations. "He will never find another job in Switzerland," a Swiss newspaper Der Sonntag quoted one banker saying this about Mr. Hildebrand. Losses at Swiss bank UBS during the financial crisis and the $2 billion loss at a UBS trading desk in 2011 have created a new awareness of systemic risk at banks. During the financial crisis banks used an optimistic estimate of "risk weighted assets" which led to insufficient capital reserves in a crisis even as the banks were shown to be well capitalized. A sense that banks in Europe and the U.S. will continue to have insufficient capital reserves at 3-4% of assets under new rules and with the longer phase in times for the new Basel III regulations of reserves at 7% of assets to after 2016....

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Renewed calls for higher capital reserves by banking regulators and Britain's Independent Banking Commission after $2 billion in losses at UBS. The losses were a result of derivatives trades made at UBS's London trading desk.

LyrArc Article Gist
An account of Kweku Adoboli's trading activities at UBS leading to the loss of $2 billion. The failure of risk management systems at UBS.