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December 16, 2009

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UBS will not pursue bosses over big losses

UBS AG will not sue its former bosses after risky bets on subprime mortgages and a strategy of helping United States clients hide money in secret accounts brought the Swiss bank to its knees.

Any action would only draw negative attention as UBS seeks a fresh start to win back client trust, the group said yesterday.

"The board has decided that years of uncertainty about these matters due to litigation ... and related negative attention from such action is not in the interest of UBS," the group said in a statement.

UBS said the board had decided not to take action after a thorough review, including consultation with external legal experts. It said its new management led by banking veteran Oswald Gruebel had taken "comprehensive and profound measures to ensure that nothing like this should ever happen again."

"The review concluded that there was no evidence of criminal conduct by former senior executives under Swiss law. Furthermore, there is no indication that they pursued personal interests to the detriment of UBS," it said.

Earlier this year, the world's No. 2 wealth manager, with US$1.7 trillion in assets and the leader in the super-wealthy sector, appointed Gruebel as chief executive and Kaspar Villiger as new chairman to try to turn the page.

Public anger over UBS's problems has focused on former chairman Marcel Ospel, who quit in April 2008 after being blamed for the aggressive risk-taking strategy in the US which brought the Swiss bank near to collapse.

Ospel and other ex-board members agreed last year to return 33 million Swiss francs (US$32 million) in payments from the bank after a media campaign against excessive bonuses.


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