Move could mean friction at branches, too much work for managers. UBS is making some of its U.S. retail-brokerage branch managers establish and manage their own books of business. Though seen as a move to increase productivity by a full-service brokerage with a reputation for having the thinnest margins in the business, some see the innovation causing unseemly competition at branches, discomfort for managers who haven't had to manage a book in a while, and more work for the effected branch managers' supervisors.

The change, made public early in August and set to take effect in the fourth quarter, stems from UBS' renovation of its U.S. regional structure this past spring. Now instead of eight regions it has three -- with 18 market areas that encompass 64 complexes, 19 standalone branches, and offices of its up-market Private Wealth Management unit.

I saw it first

It's the 100 or so managers of "associate" branches that are part of the complexes that have to start managing books this fall. For managers of the standalone branches and for managers of the complexes, it's business as usual -- except to the extent that Complex managers have to provide approvals for business conducted by the branch managers that report to them.

These changes have been made in the name of "streamlining our business and driving more decision making deeper in the organization and closer to the client," a UBS spokeswoman told Dow Jones last week. "Creating organizational structures and relationships between branches to form complexes provides us with the best opportunity to support this focus."

And though Bob Ellis of the New York-based consultancy Novarica told Dow Jones the move could of course work well if handled right, he added that UBS is running the risk of fomenting conflict over business between associate-branch producers and their managers and seeing "additional workflow being sent upstairs" to already hard-pressed complex managers. He didn't mention that associate branch managers may well have their hands full as matters stand.

Rumor has it that UBS is looking to hire Merrill Lynch's former brokerage boss Robert McCann -- who left within days of Bank of America's takeover of Merrill in January 2009. McCann is in talks with Bank of America over a suit he filed against the Charlotte, N.C.-based financial-service giant for -- he says -- keeping him from going to work for another (unnamed) firm.

UBS jumped into the U.S. private-client space in the early days of the post-Glass-Steagall era, when visions of super-profitable one-stop financial-service megamarkets help sway. Though it always had trouble making headway as a U.S. retail brokerage, by 2005 it was widely viewed as the one big-name company that had the global wealth-management game more or less figured out. By mid 2007, however, bad bets in U.S. subprime mortgages had started to eat away at the Zurich-based bank's profitability. Since then the UBS story has been dominated by writedowns, outflows and layoffs -- and a determined investigation by U.S. authorities into the bank's role in helping U.S. taxpayers hide assets from the IRS. -FWR

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