UBS reports profits drop of 39 per cent

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Scandal-hit UBS yesterday admitted internal financial controls were “not effective” when alleged rogue trading took place at the bank, as it revealed the action had triggered a 39 per cent slump in profits.

The Swiss bank posted a third-quarter profit of one billion Swiss francs (£709.8m), compared to 1.66bn Swiss francs last year, including the 1.8bn Swiss francs (£1.3bn) allegedly lost by trader Kweku Adoboli.

UBS said it discovered monitoring controls designed to ensure trading activity was valid and recorded were not in place on December 31 last year.

Former UBS trader Adoboli, 31, was charged last month with committing false accounting between October 2008 and September this year and fraud between May and September this year. He has not yet entered a plea.