Reports: UBS may have $350M Facebook trade losses

Jun 09, 2012

(AP) — Swiss bank UBS AG may have lost as much as $350 million due to technical glitches on the Nasdaq stock exchange the day Facebook went public, according to reports published Friday.

CNBC and The Wall Street Journal, citing people familiar with the matter, reported that UBS is considering legal action against Nasdaq as a result.

UBS spokeswoman Karina Byrne confirmed that the bank lost money due to Nasdaq's technical issues when the social networking company's stock began trading on May 18.

Byrne declined to disclose the amount but said it was "not material" to the bank. She said UBS has not taken legal action but is weighing its options for recovering its losses.

"Given the size of our U.S. equities business and our role as a major market maker, UBS was affected by these issues, as we believe other market participants may have been," Byrne said in a statement.

Nasdaq declined comment on the reports Friday.

The $350 million figure dwarfs previous estimates for the combined losses resulting from technical glitches at Nasdaq during Facebook's first day of trading. This week, the exchange said it would hand out $40 million in cash and credit to reimburse investment firms.

Inc.'s initial public stock offering was one of the most widely anticipated market debuts in years. But it quickly turned chaotic.

The opening was delayed by half an hour. Then, technical problems kept many investors from buying shares in the morning, or selling them later in the day, or even knowing whether their orders went through. Some investors complained they were left holding shares they didn't want.

According to CNBC and the Journal, UBS placed an order for 1 million shares but did not receive confirmations and repeated the order several times. So it ended up with much more stock than it intended.

Facebook's originally priced at $38 and closed that first day at $38.23, disappointing those hoping for a first-day surge. Nasdaq has said it was embarrassed by the glitches but that they didn't contribute to the underwhelming returns.

Explore further: Bose sues Beats over headphone patents

not rated yet
add to favorites email to friend print save as pdf

Related Stories

Nasdaq readies payouts for Facebook IPO glitch: WSJ

Jun 05, 2012

Nasdaq is taking steps toward compensating investor losses due to computer glitches that fouled trading on the first day of Facebook's $16 billion IPO, the Wall Street Journal said Tuesday.

Morgan Stanley may refund some Facebook investors

May 24, 2012

(AP) -- Morgan Stanley, the lead investment bank in Facebook's troubled initial public offering, will compensate retail investors who overpaid when they bought Facebook's stock in Friday's IPO, according to a source familiar ...

Recommended for you

Report: China to declare Qualcomm a monopoly

Jul 25, 2014

(AP)—Chinese regulators have concluded Qualcomm Inc., one of the biggest makers of chips used in mobile devices, has a monopoly, a government newspaper reported Friday.

User comments : 3

Adjust slider to filter visible comments by rank

Display comments: newest first

Husky
5 / 5 (4) Jun 09, 2012
a pack of hungry wolves choking on a bone.
Caliban
5 / 5 (1) Jun 09, 2012
@Husky,

Reminds me of that Farside cartoon that depicts lions feasting, and was captioned something like: Remember that time we were all gathered round the kill, telling jokes, and Larry laughed so hard a bone came out of his nose?

Except that the cartoon was funny.

rwinners
not rated yet Jun 10, 2012
Ah well, the greedy got gored. Good, but still this is just a smidgen compared to Jamie Diamond's big $2B !