UBS shareholders on Thursday dealt the bank's directors and executives a rare rebuke, refusing to release them from personal liability over a massive fine imposed by France earlier this year, in a signal of deep investor frustration. The so-called discharge vote is typically a formality at the bank's annual shareholders meeting that sees the UBS board securing protection from any legal action over their performance during the previous year. But shareholder anxiety is running high after UBS was fined a whopping 3.7 billion euros ($4.1 billion) in February by a French court over encouraging customers to commit tax fraud.
UBS has denied the allegations announced plans to appeal. At Thursday's meeting, 41.67 percent voted in favour of the discharge, with 41.64 percent voting against and 16.69 percent abstaining. Because the board did not secure 50 percent, the discharge was "rejected", UBS said in a statement.
"I interpret your decision as a reflection of your concern about uncertainty surrounding the ongoing court case in France and that you want to keep all possible legal options open. I can understand that," UBS board chairman Axel Weber told shareholders, according the statement. Weber also defended the bank's management, saying "France did not show in any way that UBS failed to comply with the regulations that applied at the time in France and Switzerland.