Lunchtime Links: UBS's profit targets are wildly delusional and BarCap would never have made a profit under Basel III

Yesterday, Bloomberg wrote a nasty article about UBS. It pointed out that if UBS wants to reach its profit targets, it will need to pile on risk.

That article was based partly on a note from Kian Abouhossein at JPMorgan. In his note, Abouhossein points out that the clean cost/income ratio at UBS investment bank for the third quarter was 98%. In the circumstances, says Abouhossein, UBS really needs to reduce costs, but is constrained by the need to pay its people previous deferrals [and high salaries].

Today, Gruebel has popped up to reiterate that UBS is making great strides towards its goals, but despite Oswald's efforts dissenting voices have multiplied. In another article, Bloomberg points out that UBS wants to boost pre-tax profit to CHF6bn a year, but that it earned a mere CHF2.1bn in the first nine months of 2010.

The Wall Street Journal also has something to say on the sorry subject of UBS. It quotes BAML analyst Derek DeVries, who says: "UBS is now one year into a three-to-five-year turnaround plan and the targets don't look any more achievable than they did 12 months ago."

As if to distract attention from all this, UBS analysts have issued a note of their own, concerning Barclays Capital. They point out that had BarCap operated under Basel III all along, it would have made a loss in every single year of its existence.

Anshu Jain says pure investment banks will struggle to compete globally. (Bloomberg)

UBS is expanding its custody business in Asia Pac. (ICFA Magazine)

Irish banks only survive thanks to European Central Bank lending: they currently suck up about a quarter of the ECB's liquidity provision. (Financial Times)

British and German banks hold a combined $288bn of Irish debt. (Spiegel)

The British Bankers Association denies that talks are taking place to cut the bonus pool. (Telegraph)

Ed Miliband may not want to make the 50% tax rate permanent after all. (Financial Times)

John Paulson has sold his entire stake in Goldman Sachs. (Bloomberg)

Ex-Morgan Stanley team create systematic trading investment boutique. (HedgeFundsReview)

Silver Lake private equity has poached a big technology banker from Morgan Stanley. (FinancialTimes)

More men are becoming priests. (Telegraph)

7,500 new jobs coming at Asda. (Telegraph)