The board of UBS met on Friday amid the glamour of Singapore's Grand Prix event to decide the future of its scandal-hit investment bank and CEO Oswald Gruebel, on whose watch it lost $2.3 billion in alleged rogue trading.

Top executives at the Swiss bank, which has staggered from crisis to crisis over the past three years, considered demands from investors to downsize or fence off risky trading activities and protect its core business of managing private investors' wealth.

After 5pm local time top executives started to return to the Ritz Carlton hotel from One Raffles Quay, the exclusive address where UBS offices are located.

Gruebel was whisked away in a silver Mercedes, driven out via the loading bay to avoid waiting reporters.

Alexander Wilmot-Sitwell, executive board member and co-chairman Asia Pacific, told Reuters in the hotel lobby he believed the meeting was over.

Clients pulled nearly 400 billion Swiss francs ($442 billion) -- almost 20 percent of total client assets -- from UBS during the financial crisis as the bank was battered by subprime losses, a prolonged dispute with the U.S. tax authorities and the biggest annual corporate loss in Swiss history.

The bank's inflows have since turned positive but other private banks are now circling again to nab clients worried about reputational risk in the wake of the rogue trader affair.

A UBS source said before the meeting ended that the board would be given an update on its internal investigation.

The $2.3 billion allegedly racked up by UBS trader Kweku Adoboli in unauthorized trades compares to the 4.9 billion euros

($6.6 billion) lost by rogue trader Jerome Kerviel at Societe Generale just three years ago, an event which prompted calls for tighter rules and felled that bank's then-chairman and CEO Daniel Bouton.

With his job now on the line Gruebel, a former trader himself, was expected to have urged the board to keep him and his 'integrated banking' strategy -- maintaining the investment bank which he placed at the heart of UBS' recovery when he took over in 2009.

The crisis has left Gruebel facing not only strategic issues, such as whether the bank should stick to its safer core wealth management business, but also concern about his management team and lax risk supervision.

The 67-year-old German delivered a consistent message throughout the week that the investment bank is a key part of UBS's future, despite twin British and Swiss investigations into how Adoboli evaded UBS's compliance department, sources said.

UBS's largest shareholder Singapore sovereign wealth fund GIC met the bank's management earlier this week and in a rare public statement expressed its disappointment. It urged them to take firm action to restore confidence and wanted details of how the bank would tighten risk controls.

Gruebel is expected to scale back proprietary trading and fixed income, but not do away with them completely.

They need to complete the internal investigations first. It's not necessary to call for heads to roll yet, we need more detail for that -- and it's not clear who could take over anyway, said Florian Esterer, senior portfolio manager at Swisscanto, which manages some 57 billion Swiss francs and holds around $170 million in UBS shares.

The board is in a bind because it is not sure anyone could realistically take over from Gruebel at present.

As Gruebel presented his plan to the top brass of UBS, the bank has this week been fulfilling previous promises of cutting jobs and costs, losing between 5 and 10 percent of the jobs within the advisory arm in the investment banking division.

The move is part of 3,500 job cuts previously announced in August from which UBS had hoped to make an annual saving of around 2 billion francs -- most of which will have been canceled out by the $2.3 billion loss it unveiled last week.

Adoboli, meanwhile, was sorry beyond words and appalled at the scale of the consequences of his disastrous miscalculations, his lawyer said at a brief court appearance in London on Thursday.

UBS's board meeting, one of four regular meetings per year, coincides with the Singapore Formula One motor racing Grand Prix, of which UBS is a major sponsor.

($1 = 0.906 Swiss Francs)

($1 = 0.743 Euros)

(With additional reporting by Charmian Kok and Rachel Armstrong in Singapore and Silke Koltrowitz and Martin de Sa'Pinto in Zurich; Writing by Sophie Walker; Editing by Hans-Juergen Peters)