One common criticism I hear on the street is, the U've Been Sacked bank, or Ultra Bullshit Shit bank has a poor reputation. Either through routinely failing institutional clients by wiring money incorrectly to a counter-party while they're in the middle of a lawsuit. Or finding their contracts don't mean very much when the words 'capped-fees' is just there to charm, it's misnomer in Swiss-German that means it's uncapped; a kind of screw you get out clause..
But the bank is also known for the billions they've put into R&D in dark pools, brokerage, the sheer numbers of starts-up in their rather activist, but also interesting, long-term investment strategy.
Towards this direction they're now moving fromto brokerage bank.
Yet this strategy is where it's gone all wrong. Now whenever I read of a change of tack by the bank, saying they're going revamp 'back to Warburg & Co.'s roots', or propaganda citing a CEO who believes it can return to the status of a 'classic private bank,' I wonder about the sanity of the world (and the Financial Times).
Monkeys on this forum have lamented UBS' failed attempt in having the largest investment bank in the world, going on to castigate them more for every failure, fingering the blame on their poor governance, rather poisonous brand-name, or any other tid-bit that seems to get the fuzz-box in a financial blogger's blood flowing.
Yet the problem is this: UBS' investment bank was the largest in the world. When it bought Warburg & Co., after of course Siegmund Warburg the perennial founder had already conked out , the problem has only become apparent that with his non-existent advice came an impossible ordeal to integrate the seething mass of different, conflicting entities, into one integrated unit; what came was a rearrangement reminiscent of a bad modern art fresco containing monopoly pieces, all trying unsuccessfully to fit into the brasses' wider, warped goals.
So goes the story...
UBS bought the largest stockbroker in America, Paine Webber.
One of the largest, Brinson Partners.
One of the largest American, Dillion, Read & Co.
One of the largest market makers in the world was bought, O'Connor & Associates.
One of the largest non-Swiss banks in Europe, Schroder, Munchmeyer, Hengst & Co.
To name a few. It was like, without the ridiculous non-stop incompetence from Fred Godwin -trained, Cameron Eton-educated, intimidating but ultimately barking mad Glaswegian-bred bankers.
But UBS' insatiable appetite for non-stop buying sprees, in contrast, was entirely a blessing in disguise. It was lucky that's it's has the cumbersome constitution of a sloth in its litany of large acquisition throughout the 2000s. Precisely because without the good management of Old Warburg & Co's, it could never buy too much or too quickly, or else they would have sunk their own battleship.
The turnover at UBS is wicked as well. Few employees from the original acquisitions in the 1990s survive. Most of the CEOs who were bought up leapt off on their golden parachutes and continuity in all tiers been a problem since. We can expect that an organization of UBS' size, 100,000 or so employed has turnover of at least a million in the last couple decades.
Perhaps the trend is that the bank is not too-big to fail, it's not due to the lack of capital (which is ample considering) but the fact that either in its acquisitions in Hamburg, in London, or New York, it says something to the fact that all of this is run out of Switzerland of all places.
The top brass of the company are either Swiss-German or German (slight difference in their condescending use of the language). It's like, you know the bank which has consistently denied its bread-winning Investment Bank CEO Anshu Jain the opportunity to co-run the organization of a whole because he's both Indian and a non-German speaker.
But with so many branches, assets approaching the annual GDP of developed countries, the imperial business is over. Like Sony, where everything important happens in Silicon Valley, from design to implementation of its video games business, while all of the decisions made in Tokyo, there comes the firm's inefficiencies being built into the system.
Sadly for UBS, these inefficiencies have sunk its ability to simply compete, not just perform, but survive in the global market space where any successful person, with the proper command of English, must have just the same kind of chance to become CEO or Chairman than those who happened by accident of birth to be from the same place as their predecessors.