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Thursday, September 15

UBS Rogue Trader

I plan to update this page occasionally, as the story develops. Last update 26th Sep 15:00 GMT, latest posts at the bottom of the page. The views on the incident seem to get nastier by the time. 

This is just crisis porn and more suitable for late-night viewing. Fortunes have been made and mostly lost, so this is a good primer on what to expect (FT writing about your Facebook status updates) when the middle office finds those hidden trade confirmations. If you have been lucky or only somewhat unlucky in the markets, this can be thought as a reminder that things could be much, much worse for you. Good luck, follow me on Twitter or email me. 

Dedicated section


Linkedin profiles of the perp and his boss. Delta One, just like in SocGen

Internal memo to employees
UBS rogue trader – alphaville / FT

Indirect cost increases: more risk management, investor risk aversion, bad reputation

FSA broker profile, Twitter account, also points out that similar trouble in quant funds can be expected.

Mandatory look at previous famous cases.

Points out that UBS’s risk management has been criticized in the past, too.

The timing just after the Vickers report puts an interesting twist to the debates on banking reform: “As for the bankers, they remind me of the post-1815 Bourbon monarchs who had "learned nothing and forgotten nothing".”
** What's $2 billion between friends? – Buttonwood’s notebook / The Economist

Is it even extraordinary? (Short piece)
** Too big to care – This is the Green Room

Points out that the loser rogues are tolerated because of winner rogues

Profile of the “man of the hour”
Meet Kweku Adoboli –

Speculates that the position was in EURCHF, and could have been a long volatility play.
UBS and the Big Trade? – The Trader

A rogue trader at UBS or a rogue bank? – Business blog / FT

You can probably guess Matt Taibbi’s view from the headline 

Neighbors tell he is a really nice guy, went to good school, blah blah.

16th Sep updates

Also suggests CHF as the culprit
Losing $2B Without Anyone Knowing About It Is Much Harder Than You Think – Kid Dynamite’s World

“Recent volatility in financial markets may have helped bring the losses allegedly racked up by a rogue trader at UBS to light, risk managers speculate....”

17th Sep updates

The Rogue’s Gallery –

UBS rogue trader: You were warned about ETFs, says Terry Smith – The Telegraph

18th Sep updates

 Scapegoatia-UBS reveals details of Trades – The Trader

Whither UBS’s investment bank? – Felix Salmon / Reuters

UBS loss 'came from lots of small trades over months' - BBC

(REG) UBS's Gem in Asia – WSJ

(REG) Delta Desks Emerge as Mine Fields – WSJ

19th Sep updates

Analysis: The real rogue is not UBS’s Kweku Adoboli but Delta One trading – TBIJ

A failure of all offices – This is the Green Room

Because they Aarrgh – Macro Man

Make That $2.3 Billion – DealBook / NYT

UBS rogue trade – Kengeter memo – alphaville / FT

20th Sep updates


Spotting a Rogue Trader – Advanced Trading

21st Sep updates
The UBS-Adoboli Scandal Shows the Problem of Negatively Skewed Risk is Still With Us – EconoMonitor

22nd Sep updates
Why Banks Don't Listen to their Risk Managers and Risk Losing Billions – Advanced Trading

Rogue Watch: Beware False Trades – Advanced Trading

UBS CEO Gruebel says has board's backing – Reuters

A rogue trader speaks: 'You live in fear. Your whole life is a lie' – The Independent

UBS Says Investment-Bank Operations Won't Be Sold – WSJ

UBS Suggests Employees Savor This Weekend’s Pebble Beach Outing, As Next Year’s Event Will Be Held At The Hartford Pitch ‘N Putt – Dealbreaker

23rd Sep updates
(reg) UBS Trader Faces New Charge – WSJ

Is Oswald Grubel leaving UBS?Money Is The Way

UBS Trader to Remain in CustodyDealBook / NYT

24th Sep updates
UBS Chief Resigns Over Trading Scandal NYT
The board said it regretted Mr. Grübel’s decision. Sure, that’s why one week ago he told a newspaper that as CEO he was responsible for the trading loss, but did not feel guilty and gad not thought about resigning. You’re fired!

UBS’S CEO Is Gonna Take Off Now Dealbreaker

UBS’s trading loss: Swiss missThe Economist
A huge loss at UBS will make it harder to revive its investment bank

Meanwhile, in Downtown Zurich… – The Reformed Broker
“I take money from UBS "financial advisors" all day long.  I wrench people out of its horrible hedge funds and brokerage products and I take the calls from people who say ‘all I wanted was to work with my guy at PaineWebber, how did I end up dealing with these clowns?’”

UBS' CEO Booted – ZH
“The UBS "Rogue Trader" incident which was anything but rogue and certainly involved far more than just a trader, has struck at the very top”

UBS rogue trader: Oswald Grübel resigns – The Telegraph

UBS rogue trader: KPMG to lead investigation into bank failings – The Telegraph

UBS jobs in peril as CEO quits over alleged rogue trader scandal – The Guardian

25th Sep updates
UBS: Ossie out – Schumpeter / The Economist

New UBS boss seeks fresh start after trading scandal – Reuters

UBS hopes small is less risky – BBC

26th Sep updates 
UBS’s Grübel Steps Down, More May Follow – The Source / WSJ

UBS Shares Rise on Chief’s Departure – DealBook / NYT

Rogue Trading Leads UBS Chief to Resign – NYT

Who Wants To Be CEO Of UBS? – Dealbreaker

27th Sep updates

UBS in ‘Disarray’ as CEO Gruebel Is Replaced by Ermotti – Businessweek

UBS 'rogue trader' offices to be knocked down – The Telegraph

Minor UBS Shareholder Wants Everybody Out, Has A Few Ideas About Future Leadership – Dealbreaker

UBS Shareholders Push for Deeper Changes – WSJ

UBS’s New Chief: We Will Keep Our Investment Bank – DealBook / NYT

In Rogue Trading Scandal, a Reason to Enforce the Volcker Rule – DealBook / NYT