UBS Q2 Net down over 58 pc at 425 mn franc

UBS had posted a net profit of 1.02 billion francs in the April-June period of 2011.

The company attributed the whopping 58.12 per cent fall in the second quarter profit to "challenging conditions marked by increased volatility and greater client caution" and "escalating euro-zone fears and slower growth in the US", the company said in a statement.

UBS also recorded a loss of 349 million franc from the gross mishandling of Facebook's market debut by Nasdaq. The company was exposed to far more shares than its clients had ordered due to Nasdaq's technical glitch.

"We will take appropriate legal action against Nasdaq to address its gross mishandling of the offering and its substantial failures to perform its duties," UBS said.

Although there can be no assurance as to the amount of any recovery "we intend to pursue compensation for the full extent of our losses," UBS said.

UBS' operating expenses increased by 236 million franc to 5,457 million franc.

The investment bank recorded a pre-tax loss of 130 million franc in the second quarter of 2012, as against a pre- tax profit of 730 million franc in the first quarter of 2012.

Commenting on UBS's second-quarter results, Group CEO Sergio P Ermotti said "we will continue to focus on prudent liquidity management, further reducing risk-weighted assets and delivering the best possible service to our clients.

"I have the utmost confidence in our ability to deliver on our firm's strategy by adapting our execution in a changing environment."

However, UBS further noted that it has managed costs "prudently" and UBS is on track to deliver better results by the end of 2013.

"Continued vigilance on costs is keeping us firmly on track to deliver our entire planned cost savings by the end of 2013 and we continue to explore avenues to improve efficiency," Ermotti said.

UBS employed 63,520 personnel as of June 30, 2012, compared to 64,243 personnel as of March 31 2012.

Switzerland's largest bank UBS, which is reportedly cutting 3,500 jobs, said the the decrease of 723 personnel in the June quarter was "mainly related to continued focus on cost reduction across most business divisions."