Carsten Kengeter's days at UBS may be numbered.

 

The UBS board met today in New York to consider a reorganization of the investment bank unit.  On the table are cuts centered on fixed-income operations which has been run by Carsten Kengeter since 2008.  As it stands now, Mr. Kengeter's role would be reduced and added responsibilities would go to his co-head Andrea Orcel - that according to 3 people with knowledge of the matter. 

 

However, little if any information will be divulged at this time - UBS probably would wait to make any announcement until Tuesday, 10/30/12, when the bank is scheduled to issue its Q3 earnings report. 

 

New CEO Overhaul. CEO Sergio Ermotti, 52, is overhauling the bank as Swiss regulators pressure both UBS and Credit Suisse to boost capital and scale back their trading and investment-banking operations. UBS already was in the process of cutting risk-weighted assets at the investment bank - by > 50% of September 2011 levels - mostly in fixed income.  Additional job cuts are on the way, affecting some 400 staffers, or 10% of the investment bank’s front-office employees in Europe.  Last year, the bank announced plans to eliminate 1,600 positions at the unit.
 

Mr. Kengeter's History. The co-head, 45, has run the investment bank since April 2009, first as co-head with Alexander Wilmot-Sitwell, then alone, and since July as co-CEO with Ms. Orcel, 49, a former top dealmaker at Bank of America Corp.  Mr. Kengeter has deep roots at the firm:

"It’s good that they’re not sitting on their hands.  You’ve got to keep responding to the changing market environment." -- Christopher Wheeler, a banking analyst at Mediobanca SpA in London. 

 

For further details, go to [Bloomberg, 10/25/12].