Swiss bank UBS AG (UBSN.VX: Quote, Profile, Research, Stock Buzz) (UBS.N: Quote, Profile, Research, Stock Buzz) appointed former Credit Suisse (CSGN.VX: Quote, Profile, Research, Stock Buzz) executive Ulrich Koerner as chief operating officer to oversee a drive to centralize group services, aiming to cut costs and boost profits.

UBS Chief Executive Oswald Gruebel, the former Credit Suisse CEO who UBS appointed in February to try to turn the struggling bank around, said he had brought in Koerner as he had extensive expertise in processes, systems and technologies.

UBS said he had a track record as a turnaround manager at Credit Suisse and would seek group-wide measures to enhance profitability and cost efficiency, supporting Gruebel and division heads to develop and implement strategy.

Koerner will oversee the bundling of group-wide units like personnel management, procurement, real estate and facility management into the bank's corporate center.

Information technology units of the business divisions will also be consolidated at group level, which UBS said should create sustainable efficiency increases and cost savings.

Shares in UBS, which have tumbled in recent days on fears that the bank will announce further writedowns as Gruebel seeks to get all the bad news out of the way, were up 2.3 percent at 10.95 Swiss francs at 0720 GMT, while the DJ Stoxx European banking sector index was down 1.2 percent.

A UBS spokesman said the bank could not quantify the savings from the moves and said it was making no immediate job cuts, but noted that returning to profitability was a high priority and the banking industry was a personnel-intensive one.

The areas to be centralized, including IT, personnel, procurement and facility management, currently employ about 15,000, many of them in Switzerland, the spokesman said.

The bank has already announced 7,500 jobs cuts in the crisis, aiming to bring its total workforce to around 75,000 by the middle of the year, from about 77,000 in February.

A German-Swiss dual national born in 1962, Koerner joined Credit Suisse in 1998 and held various management positions, including COO and Chief Financial Officer of a business unit.

His last job at Credit Suisse was heading the Swiss client business, before he left the bank last September.


Gruebel, pulled out of retirement to turn around UBS, had already signaled that further cost cuts would be inevitable.

UBS also said it is strengthening the management of its finance and risk control as well as its legal and compliance functions at the group level, which it said would make control functions stronger and more effective.

The tarnished Swiss banking icon is struggling to rebuild its once powerful brand after massive investments in risky U.S. assets forced it to accept a government bailout last year.

The bank revised up its 2008 net loss to 20.9 billion Swiss francs ($18.37 billion) on March 11 to include a $780 million fine to settle a damaging U.S. tax probe case.

It said at the time its near-term outlook was extremely cautious, warning that its balance sheet remained exposed to illiquid and volatile markets.

Koerner, who has a doctorate from St. Gallen university in business administration, previously worked as an auditor and management consultant, mainly for financial services firms.

He replaces Walter Stuerzinger, currently COO of the corporate center, who UBS said will leave the board but has committed himself to supporting Koerner.

($1=1.138 Swiss Franc)

(Editing by John Stonestreet and Hans Peters)