UK: Rogue trader costs UBS banking group �1.3billion

SWISS banking group UBS today revealed a rogue trader had cost it an estimated �1.3billion.

The group, which has a number of offices in the UK, said the unauthorised trading took place in its investment banking division costing around two billion US dollars.

It has not given further details about the activities, which could lead to it reporting a loss for the third quarter of its financial year. UBS said no customer accounts were affected.

The Zurich-based firm said: “UBS has discovered a loss due to unauthorised trading by a trader in its investment bank.

“The matter is still being investigated, but UBS’s current estimate of the loss on the trades is in the range of two billion US dollars.

“It is possible that this could lead UBS to report a loss for the third quarter of 2011. No client positions were affected.”

Shares in the bank were down by more than 7% today.