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Opinion

Why UBS needs Marcel Ospel – for now

UBS’s chairman is struggling to hold on but shareholders must resist temptation to remove him at the moment.

The next few weeks are the most important in Marcel Ospel's career. The chairman of UBS is under pressure to follow the examples of Stan O’Neal and Chuck Prince and fall on his sword in the wake of the Swiss bank’s horrendous performance over the past 12 months.

On February 27 he will have to battle with shareholders at an extraordinary meeting. They are increasingly angry about the disasters that have befallen UBS since 2007 – the Dillon Read Capital Management fiasco, the departures of several senior executives, the $14.5 billion of bad debt write-downs and the collapsing share price.

The meeting is being convened to approve the SFr13 billion ($11.3 billion) of investments from Singapore’s GIC and an unnamed Middle East investor. Some UBS investors had already voiced their displeasure at the capital injections, concerned by the source of the funds and the fact that the deal dilutes existing shareholder equity.

Ospel’s own future is not up for formal discussion, although it is bound to be an issue behind the scenes. The 57-year-old has to deliver the performance of a lifetime if he is to have any chance of holding on to his job.

Instead, Ospel’s positions as chairman and as a member of the board of directors, which are up for renewal every three years, will be voted on in April during the bank’s annual meeting.

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