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10,000 staff face axe as Swiss giant UBS announces jobs cull

Banking giant UBS AG has announced that 10,000 jobs are to be cut in a bid to reduce the size of its investment bank.

Switzerland's biggest bank said it is "likely to have a headcount of around 54,000" by 2015, down from its current 64,000.

Chief executive Sergio Ermotti said the investment unit, which has been hit by a series of costly blunders in recent years, will "continue to be significant global player in its core businesses".

The bank posted a net profit loss of £1.44bn, compared with a profit of £679m during the same three-month period through September 2011.

In what it called "a significant acceleration" in its transformation, the Zurich-based bank said it would sharpen its focus on the investment bank and appoint a new executive to lead it.

Ahead of the cuts, the value of UBS's stock rose 7.3% to close at 13.12 Swiss francs (£8.73) on Monday on the Zurich exchange.

The bank attributed some of the declining profit to a pretax charge of £574m linked to an accounting rule on how banks must value their debt.

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Banks can post gains if the value of their debt falls, because it would theoretically become cheaper for the bank to repurchase that debt.

But the accounting rule also says that when a bank's debt increases, it must take a write-down because it would theoretically be more expensive for the bank to buy back its own debt on the open market.