The New York Times is reporting that the CEO of UBS, Oswald Grubel, is resigning due to losses of $2.3 billion from a fraudulent trading scheme. Mr. Grubel had assumed the position in 2009 after the bank replaced the former CEO for losses in trading sub-prime mortgages.
UBS appears to have a record of holding the CEO accountable for poor performance, particularly when it is attributable to control weaknesses. I think that this approach is fair, although I would expect that every manager between the rogue trader and Mr. Grubel should be relieved of their position.
