UBS expected to post big fixed-income loss: report

(CNNMoney) -- UBS, the Swiss bank, is expected to announce Monday a third-quarter loss of 600 million to 700 million Swiss francs ($510 million to $600 million) from its fixed-income unit, according to a published report.

The fixed-income loss would be announced before UBS's overall third-quarter results, which are due October 30, according to the Wall Street Journal, citing people familiar with the situation.

The loss is based on a writedown of 3 billion to 4 billion Swiss francs for fixed-income assets, the Journal reported on its website Sunday.

Partly the fixed-income losses stem from continuing costs associated with writing off bad bets by its in-house hedge fund, Dillon Read Capital Management, in the subprime mortgage market, according to the Journal. But other securities held by the fixed-income division contibuted to the loss too, it said.

In July, UBS (Charts) reshuffled its management team - replacing then-CEO Peter Wuffli with Marcel Rohner, who was deputy CEO at the time - in the wake of the Dillon Read hedge fund blow-up, which proved costly for the investment bank.

UBS warned in August that its profits would be lower in the second half if the third quarter continued to see difficult market conditions.