Higher performance-related compensation and basic salary increases drove staff costs at UBS' investment bank up 24% to Sfr1.5bn (€980m) in the second quarter from the first, despite a drop of more than 1,100 in staff numbers. The departures of key staff also meant the bank missed the credit market rally, leaving the division nursing a Sfr1.8bn pre-tax loss that was slightly bigger than analysts had predicted.

While quarterly revenues at UBS' investment bank turned positive in the three months to June for the first time since the second quarter of 2007 thanks to the absence of sizeable writedowns and losses, a Sfr1.2bn charge on the bank's own debt kept the investment bank in the red before tax.