UBS, Europe’s largest bank, today warned investors it could face further write-downs of assets because of the sub-prime mortgage crisis, as it announced a third-quarter pre-tax loss of Sfr726m (300m).

The loss came within the Sfr600-800m range indicated by chief executive Marcel Rohner on October 1 but was bigger than the market expected. UBS said it expected the group to return to profitability in the last quarter of what has been a turbulent year.

The Swiss bank, which took charges of Sfr4.2bn on sub-prime-related losses in fixed income investments in the third quarter, said its investment bank was likely to make further losses in the final quarter.

It said it was exposed to further deterioration in the US housing and mortgage-related markets as well as rating downgrades for mortgage-related securities “which could lead to further write-downs on the positions”.

Mr Rohner, the first of Europe’s Big Three banking chiefs to report this week on the impact of the credit crunch, said the result was “unquestionably disappointing” but insisted the bank was dealing with the problems through management changes and sharper risk assessment.

Deutsche Bank and Credit Suisse report their third-quarter results tomorrow and Thursday respectively.

This entry was posted on Tuesday, October 30th, 2007 at 12:27 pm While Dave was in Money. Responses are currently closed, but you can trackback from your own site.