European banking giant UBS, hit hard by the U.S. subprime crisis, will reduce its investment banking business with staff cuts mainly in the U.S., according to an internal memo to employees on Friday.
The company, which wrote down $14.7 billion last year due to subprime, will close a division which makes fixed income investments and cut its real estate securitization team by 50 percent from its highest levels in August, UBS Chief Executive Marcel Rohner wrote.
It will also reduced the capital allocated to its real estate unit by two thirds.
He did not specify the total number of employees to be cut.
``We will continue to examine and refine our strategy, with the objective of improving efficiency and returning the area to profitability,'' Rohner stated, referring to the fixed income unit.
Shares of UBS closed down 89 cents, or 2.18 percent to $40.00 on the New York Stock Exchange.