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From a Rock to a hard place: Arnold targets UBS
LONDON (Reuters) - Luqman Arnold, or "Lucky" as he is known, must like a challenge: just months after failing with a rescue bid for Northern Rock he has turned his fire on UBS, the troubled Swiss bank he used to run.
Arnold is demanding a shake-up at UBS. He wants to sell off chunks, potentially including its investment bank unit to reduce it to its wealth management rump.
It's just over six years since Arnold was ousted from UBS, but his plans are about making money rather than revenge, and his boutique investment vehicle Olivant has bought a 0.7 percent stake, worth almost $500 million.
The 57-year-old's plan is backed by intimate knowledge of UBS's strength and weaknesses and deep contacts there.
He was chief executive for less than a year and left after losing a power struggle with Chairman Marcel Ospel in December 2001, reportedly because Ospel agreed to a controversial loan for Swissair without informing Arnold.
Ospel quit last week after UBS doubled its writedown on risky assets to $37 billion, making it the worst hit bank from the U.S. subprime housing crisis.
BATTLE HORN
Arnold has a well traveled past and now lives in London, where his wife, Chumsri, runs a chain of Thai restaurants.
Born in Calcutta in April 1950, he was educated at Oundle, a private school in eastern England. He gained a degree in economics from the University of London externally, studying while he helped run his father's dairy farm in Australia.
His career in banking began in 1972 with First National Bank in Dallas and most of his career has been in investment banking, including at Credit Suisse and Paribas.
He joined UBS in 1996, helping extricate the bank from $700 million of losses linked to collapsed hedge fund Long Term Capital Management.
He was well regarded at the bank but was not Swiss and was seen as an outsider by the Zurich hierarchy, and there was only one outcome after his clash with Ospel, according to reports.
From UBS, Arnold was named CEO of British mortgage bank Abbey and was tasked with restructuring the misfiring lender, but his revival plan was cut short by Santander's takeover of the bank in 2004.
After setting up Olivant -- named after a medieval battle horn made from an elephant's tusks -- he returned to the spotlight last November with his rescue pitch for Northern Rock. It was one of a trio of serious alternatives to nationalization, but he withdrew in February.
His retreat showed he would not let a desire for a big deal get in the way of a bad business case, supporters said; others were not sure how serious he was from the start, noting Olivant's expenses were paid for by Northern Rock.
