UBS plans push in the US
Saturday, 14 July 2007
Lina Saigol in London
UBS has initiated an aggressive drive in the US to revive its investment banking operation, in an effort to halt its slide down the advisory league tables for mergers and acquisitions.
Rick Leaman and Alex Wilmot-Sitwell, joint global heads of investment banking at UBS, who are spearheading the push, have designed a three-pronged approach to tackle their position in the US: increase leveraged lending; focus on bigger clients and make strategic hires, as well as redeploy existing bankers to the operation.
The Zurich-based bank last week it ousted Peter Wuffli, its chief executive, because of losses at Dillon Read Capital Management, the in-house hedge fund UBS set up two years ago and closed down in May following losses on investments in the US subprime mortgage market. Mr Wuffli was replaced by Marcel Rohner, the head of its private banking unit.
"Attacking our league table standing in the US is a huge priority for us. We want to have a top five ranking in the US over the next two to three years," Mr Leaman said.
UBS ranks 10th in the league tables for US M&A in the year to date, below Bank of America and Deutsche Bank, according to data from Thomson Financial. In Europe and Asia, it ranks number three and number one, respectively.
Mr Wilmot-Sitwell and Mr Leaman will lend more aggressively to private equity groups, a main driver of the current M&A boom. "The US has seen a series of jumbo deals, including the buy-outs of TXU; Equity Office Partners and First Data. We haven't been involved in any of them. In order to change our positioning in this market?.?.?.?we have to bank the large clients," Mr Wilmot-Sitwell said.
The decline in UBS's positioning in the US has been exacerbated by key defections this year, including Ken Moelis, president of the investment banking division, who helped establish the bank on Wall Street.
Mr Wilmot-Sitwell and Mr Leaman have been identifying the "elephant deals" where consolidation is likely and are incentivising bankers to build long-term relationships with clients.
UBS has initiated an aggressive drive in the US to revive its investment banking operation, in an effort to halt its slide down the advisory league tables for mergers and acquisitions.
Rick Leaman and Alex Wilmot-Sitwell, joint global heads of investment banking at UBS, who are spearheading the push, have designed a three-pronged approach to tackle their position in the US: increase leveraged lending; focus on bigger clients and make strategic hires, as well as redeploy existing bankers to the operation.
The Zurich-based bank last week it ousted Peter Wuffli, its chief executive, because of losses at Dillon Read Capital Management, the in-house hedge fund UBS set up two years ago and closed down in May following losses on investments in the US subprime mortgage market. Mr Wuffli was replaced by Marcel Rohner, the head of its private banking unit.
"Attacking our league table standing in the US is a huge priority for us. We want to have a top five ranking in the US over the next two to three years," Mr Leaman said.
UBS ranks 10th in the league tables for US M&A in the year to date, below Bank of America and Deutsche Bank, according to data from Thomson Financial. In Europe and Asia, it ranks number three and number one, respectively.
Mr Wilmot-Sitwell and Mr Leaman will lend more aggressively to private equity groups, a main driver of the current M&A boom. "The US has seen a series of jumbo deals, including the buy-outs of TXU; Equity Office Partners and First Data. We haven't been involved in any of them. In order to change our positioning in this market?.?.?.?we have to bank the large clients," Mr Wilmot-Sitwell said.
The decline in UBS's positioning in the US has been exacerbated by key defections this year, including Ken Moelis, president of the investment banking division, who helped establish the bank on Wall Street.
Mr Wilmot-Sitwell and Mr Leaman have been identifying the "elephant deals" where consolidation is likely and are incentivising bankers to build long-term relationships with clients.