UBS to take remedial action after Australian investigation

Australia's corporate regulator on Tuesday said it will not take further action against the Australian arm of multi-national investment bank UBS AG following an investigation into its control and compliant practices if internal remedial action is taken.

The investigation arose amid allegations UBS Securities removed negative parts of an independent report into the TransGrid privatisation after the New South Wales state government ordered it to do so. Intense political scrutiny of the transaction which saw the state-owned asset sold to an Australian-led consortium for 10.258 billion Australian dollars (7.38 billion U.S. dollars).

Following the investigation, the Australian Securities and Investment Commission (ASIC) said UBS will take "remedial steps to improve its control framework" including changes in structure, policies, procedures and training.

"ASIC was concerned that UBS Securities' control framework relating to its research function, and its compliance with that framework, at the relevant times was not adequate for an investment bank of UBS's size and complexity," ASIC said in a statement on Tuesday.

"Should ASIC determine that any of these changes have not been fully implemented or maintained, it would be open to ASIC to take appropriate action, including enforcement action where warranted."

It's understood UBS has appointed an independent expert to review the implementation of measures such as additional supervisory roles in its research department and increased compliance coverage to report back to ASIC that the measures have been implemented and maintained.