Early this morning, Swiss bank UBS (NYSE: UBS) announced that it lost $1.02 billion more than it earlier reported -- thanks to a recent settlement with U.S. authorities. A write-down of assets transferred to the Swiss National Bank also contributed to the wider-than-reported loss.According to MarketWatch, UBS's loss totaled 20.89 billion francs compared to its earlier reported loss of 19.7 billion francs. UBS's CEO added that the bank's balance sheet is still vulnerable to "illiquid and volatile markets," leaving its earnings "at risk for some time to come."
The article notes that the major reason for the loss was the inclusion of UBS's earlier-announced payment of $780 million to U.S. authorities. The payment was made to satisfy a deferred prosecution agreement over charges that the bank conspired to defraud the U.S. by hampering the IRS.
Shares of the Swiss bank have been falling faster than a skier down the Alps. In October 2007, the stock was trading in the $55 region. The stock is currently trading in the $8.50 region and it faces a number of potential roadblocks. To move higher, UBS will need to topple its 10- and 20-week moving averages along with the round-number $10 level. It would not be an understatement to state that UBS faces an avalanche of southbound pressure if it is going to get back to its old form.
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