Banking giant UBS has announced plans to integrate its wealth management units, and launch new alternative investment management business.

UBS’s US, Swiss and international wealth management businesses, and its Swiss corporate and retail banking units will be brought together in one group called Global Wealth Management & Business Banking under chairman and CEO, Marcel Rohner.

“While the relationships between advisors and their clients will not be in any way altered, UBS expects to benefit from economies of scale in bringing together functions supporting the advisors,” UBS says. “The move will accelerate UBS’s progress towards a consistent wealth management offering across the globe, and will make it even easier to fulfil clients’ individual needs with sophisticated products and services from across UBS.”

Peter Wuffli, CEO of UBS, says, “We have a strong track record of benefiting from an integrated approach – the combination we are announcing today is the right next step made at the right time. Our US wealth management business has made huge progress under the leadership of Mark Sutton since PaineWebber joined UBS, growing market share, productivity, and profitability. That success has paved the way for this logical next move.”

Mark Sutton, currently chairman and CEO of the Wealth Management USA business will be appointed to the new position of chairman and CEO, Americas, responsible for accelerating the development of UBS’s client base and integrating the work of UBS’s businesses in the region. He will report directly to Wuffli.

The firm also announced the formation of a new alternative investment management business, Dillon Read Capital Management, to launch January 1, 2006. This new initiative will see UBS’s principal finance and commercial real estate trading businesses move from the fixed income, rates and currencies area of its investment bank to form the core of the new unit within the Global Asset Management business. Approximately 120 staff will transfer, mainly based in New York.

The trading strategies managed by the team will be opened up to co-investment from sophisticated, principally institutional clients, and will be supplemented by further new offerings. “In this way UBS will build a new stream of investment management fees from what has until now been a purely in-house trading activity,” the firm says. “UBS will retain its current direct investment in the relevant trading portfolios, with any incremental future investments subject to UBS’s usual risk management processes.” This new business is similar to other alternative asset management units within UBS, based on trading strategies developed within its investment bank.

John Costas, currently chairman and CEO of UBS’s investment bank, will lead this new business as CEO. “I am terrifically excited to have this entrepreneurial opportunity to build a new business within UBS. Investors have huge appetite for alternative investment products backed up by the quality assurance of a global financial leader – we can fulfill that demand,” he says.