TIMELINE: UBS seeks to turn corner after year of turmoil
(Reuters) - Swiss bank UBS AG said on Thursday it expected to make a small profit in the third quarter, as the world's biggest wealth manager seeks to turn the corner after heavy writedowns in the credit crisis.
The Swiss bank, which has written down $42 billion due to its large exposure to toxic assets, said it had substantially reduced its U.S. commercial and residential mortgage-related assets, mainly through disposals.
UBS also reiterated it expected 2009 would be a profitable year overall. UBS has posted four straight quarters of losses, most recently reporting a loss of $322 million in the second quarter. It is due to announce third quarter results on November 4.
Following are key events in the downturn that impacted the world's biggest banker for the rich, which started in May, 2007, when it closed down its Dillon Read hedge fund unit.
* CLOSES DILLON READ HEDGE FUND UNIT - MAY 3, 2007
UBS shocks investors by closing down its Dillon Read hedge fund unit after posting lower-than-expected first-quarter results, a rare event from the bank, whose track record had earned it a reputation as a serial outperformer.
* WRITEDOWNS TO CAUSE THIRD-QUARTER LOSS - OCTOBER 1, 2007
UBS warns a 4 billion Swiss franc subprime hit would cause a third-quarter pre-tax loss of between 600 and 800 million Swiss francs. A few weeks later, UBS's quarterly loss -- its first in nine years -- at 726 million Swiss francs is within that range.
* MORE WRITEDOWNS - JANUARY 30, 2008
UBS announces another subprime writedown, this time of $4 billion. Two weeks later the bank posts a full-year loss of 4.4 billion Swiss francs, announcing tens of billions of dollars in new exposure to risky U.S. mortgages, leveraged finance and complex securities, sending shares tumbling.
Shareholders then back a $11.9 billion capital injection from Singapore and an unidentified Middle East investor.
* WRITEDOWNS DOUBLE, NEW CHAIRMAN - APRIL 1, 2008
UBS doubles its writedowns from the subprime crisis, dumps its chairman, Marcel Ospel, and seeks more emergency capital.
The bank writes down an additional $19 billion in ailing assets, causing a net loss of $12 billion in the first quarter. It proposes its lawyer, Peter Kurer, as Ospel's successor.
Activist investor and former chief executive Luqman Arnold then demands UBS shake up its governance and structure, with a view to selling its investment banking business.
* SLASHES JOBS - MAY 6, 2008
UBS says it will axe 5,500 jobs and sell billions of dollars of ailing assets in a bid to break free from the subprime crisis. The job cuts come on top of 1,500 already completed.
UBS also unveils a preliminary deal with U.S. asset manager BlackRock Inc to sell for $15 billion a portfolio of subprime mortgages with a face value of $22 billion.
The bank launches a $15.6 billion rights issue at a third below its market price to repair its battered balance sheet.
* EX-UBS BANKER PLEADS GUILTY TO US TAX EVASION - June 19
A former UBS banker who once smuggled a client's diamonds into the United States in a toothpaste tube pleads guilty to helping a billionaire hide $200 million in assets from U.S. tax authorities, part of a broader tax evasion probe of UBS.
* MASSACHUSETTS SUES FOR FRAUD - JUNE 26, 2008
Massachusetts authorities sue two UBS subsidiaries for fraud, saying they misled investors about the safety of auction-rate securities. A month later, New York State also sues UBS, accusing the Swiss bank of steering broker clients into securities they could not sell once the credit market tightened.
* AGREES TO BUY BACK DEBT SECURITIES - AUGUST 9, 2008
UBS agrees to buy back $18.6 billion of auction-rate securities and to pay $150 million to settle charges it misled investors -- the largest settlement in the U.S.-wide probe.
* SPLITS WEALTH MANAGEMENT, INVESTMENT BANK - AUG 12, 2008
UBS says it will separate its prized wealth management business from investment banking, acknowledging flaws in its much-vaunted one-bank strategy. It also reports a second-quarter loss of 358 million Swiss francs.
* LEHMAN COLLAPSE PUSHES SHARES TO NEW LOWS - Sept 16
UBS shares fall sharply to their lowest level since they were listed in their current form in 1998, after U.S. investment bank Lehman Brothers files for bankruptcy.
* BACK IN PROFIT DESPITE CRISIS - Oct 2
Ahead of an extraordinary shareholder meeting, UBS says it will make a small profit in the third quarter and says it has substantially reduced its U.S. commercial and residential mortgage-related holdings, mainly through disposals.
(editing by John Stonestreet)
