Swiss banking giant UBS has formed a special unit to hold its illiquid US real estate assets as it reports writedowns of $19bn from the US sub-prime crisis.
In Q1 UBS says it substantially reduced its real estate related positions through both valuation adjustments and significant disposals.
Its also confident that the new unit should it allow it to deal with the firms exposure to the US housing market and sub-prime crisis.
UBSs chairman, Marcel Ospel, will not be seeking re-election at the banks Annual General Meeting on April 23 2008.
Marcel Rohner, chief executive officer of UBS, says: “We believe this capital increase and the creation of a vehicle to separate problem assets from the remainder of our businesses will allow us to return to sustainable value creation over time.
He adds: With these measures we have created the basis to weather one of the most difficult periods in the history of the industry.”