After UBS hedge fund trouble, executives shuffle

NEW YORK (CNNMoney.com) -- UBS late Thursday announced it's replacing Chief Executive Peter Wuffli with deputy CEO Marcel Rohner, among other executive management changes, following a hedge fund blow-up that proved costly for the investment bank.

Effective today, Wuffli relinquishes all of his functions at UBS. As a result, Raoul Weil will succeed Rohner as Chairman and CEO of Global Wealth Management & Business Banking, UBS said in a prepared statement.

Chairman of the Board of Directors Marcel Ospel will be nominated for another three-year term once his current term expires.

Last year, Ospel proposed to retire from his post at UBS to make room for a new generation of management, suggesting that Peter Wuffli be nominated his successor, UBS said. The Board of Directors decided not to accept his proposal.

The shakeup could be a move to prevent a breakup of the firm, which includes the former PaineWebber brokerage as well as a large private banking and wealth management business based in Europe, The Wall Street Journal reported late Thursday, citing sources familiar with the firm.

In May, UBS, the world's largest asset manager, shut down its in-house Dillon Read Capital Management after the hedge fund reported a $124 million loss due to bad bets in the subprime mortgage market.

UBS (Charts) shares were edging lower in after-hours trading on the New York Stock Exchange Thursday.