Swiss Bank UBS Ousts President

UBS, Switzerland’s biggest bank, ousted President Luqman Arnold on Tuesday amid management disagreements over the company’s course.

Some analysts said a key point of contention was Luqman’s decision to rein in the firm’s newly aggressive investment-banking arm headed by Los Angeles-based Ken Moelis.

Analysts said Moelis was forced in October to scrap a $3-billion loan commitment to EchoStar Communications when the latter was bidding for General Motors’ Hughes Electronics unit. Arnold was the head of the UBS board with responsibility for allocating credit.

UBS rivals Deutsche Bank and Credit Suisse First Boston stepped in--and earned fees of $55 million for the deal.

Moelis, 43, long a major deal-maker in the investment banking business, was hired by UBS a year ago from CSFB to boost UBS’ profile in the business.

“The most plausible reason for Arnold’s fast exit is the differences he had with American investment bankers,” said James Alexander, an analyst at Commerzbank Securities in London.

Arnold had been in the job just eight months. He left because of “differences of opinion,” according to his successor, Peter Wuffli, head of UBS’ asset management arm. He refused to be more specific.

Some analysts also cited a power struggle between Luqman--a Briton--and his Swiss peers.