A rogue trader at UBS has lost around $2 billion, the Swiss banking giant says. The unauthorized trades by a trader in its investment banking unit "could lead UBS to report a loss for the third quarter of 2011," but "no client positions were affected," the bank said in a statement that offered few other details. Shares in UBS dived almost 10% in early trading after the announcement, which arrived on the third anniversary of Lehman Brothers' declaration of bankruptcy, the Guardian notes.
The Wall Street Journal identifies the 31-year-old, who was arrested by British police at 3:30am UK time today, as Kweku Adoboli. He reportedly worked in London, at UBS' trading desk for exchange-traded funds. The AP notes that the unauthorized trades could erase nearly all of the 2 billion Swiss francs ($2.28 billion) UBS last month announced that it hoped to save by doing away with 3,500 jobs over two years. (Read more banking stories.)