UBS says wealth management belongs within bank

GENEVA (Reuters) - UBS (UBSN.VX) believes its investment banking and wealth management businesses should stay under one roof, company Chairman Marcel Ospel said on Tuesday.

Ospel acknowledged risks to the bank's wealth management from its subprime mortgage-related write-downs of assets, but pointed out the wealth management operation has received fresh funds and that there were synergies between the two businesses.

"These are the key reasons why it does make strategic sense to operate those two businesses under the same roof and as closely as possible," he said after giving a lecture on trends in financial markets.

UBS faces up to $15 billion in credit-related losses this year, analysts say, on top of $18 billion write-downs in 2007, increasing pressure for a break-up or a radical overhaul.

If hit by further losses, as expected, UBS may be forced to sell its U.S. wealth management arm, built up expensively through purchases such as that of Paine Webber & Co in 2000, according to analysts.

Observers are also wondering whether the wealth management franchise, which manages investments for the super-rich, could be listed separately and sold in part to existing shareholders.

Ospel noted that the Government of Singapore Investment Corp had become a shareholder of UBS.

But he declined to name a second Middle Eastern investor, who together with the Singapore GIC has taken a stake in the bank through a 13 billion Swiss franc ($12.55 billion) capital injection.

Ospel said it was not up to UBS but to the investor to make the disclosure.

"They're restructuring their global asset base and it could well be that once they've concluded that process they will then come forward with a disclosure," he said. "I don't exclude that."

He said the investor had the right to remain unidentified as the disclosure threshold in Switzerland was 3 percent.

(Reporting by Jonathan Lynn, writing by Sam Cage, editing by Richard Chang)