The aftershocks of a Swiss bank's massive losses just keep coming. UBS' chief executive, Oswald Grübel, suddenly resigned as chairman and CEO of UBS Saturday after a two-day meeting of the giant bank's board and senior management in Singapore. The bank has been coping with a $2.3 billion loss by trader Kweku Adoboli, who apparently was able to cover up his losses with fake trades. The bank has insisted that it has the ability to overcome the losses, but Grübel apparently decided to step down to allow a revamping of the bank's oversight procedures.
Adoboli, 31, is a native of Ghana who went to England 20 years ago to attend boarding school. Son of a former United Nations official, he worked on UBS' Delta One trading desk, a loosely supervised unit made up of young traders.
"As CEO, I bear full responsibility for what occurs at UBS," [Grüber] said in a memo to staff. "From my first day on the job I placed the reputation of the bank above all else. That is why I want to and must act according to my convictions."
UBS Europe chief Sergio P. Ermotti will take over immediately as interim chief executive until Gruebel's replacement is appointed.
Gruebel's departure caps 10 days of speculation over his future following the bank's announcement that a single London-based trader had evaded internal control systems and gambled away $2.3 billion.
The trader, 31-year-old Kweku Adoboli, was arrested Sept. 15 and charged with fraud and false accounting. A judge ordered him Thursday to be held in jail until a hearing next month.
Source: the Washington Post.
No doubt Adoboli has his own responsibilities in the scandal, but the question of adult supervision will surely come up in investigations and the trial. Meanwhile, surely no one could have predicted a scenario where a young man from Ghana would derail the career of a senior Swiss banking official.
Read more at the Washington Post.