UBS, Europe's loss-making largest bank, has hired one of Morgan Stanley's highest-ranking executives to lead its investment banking division.

Jerker Johansson is replacing Huw Jenkins, who left UBS in October after the bank disclosed writedowns of its fixed-income assets. The writedowns now total $18.4 billion (£9.4 billion).

UBS is expected to confirm a loss of SwFr4.4 billion (£2 billion) when it reports full-year figures tomorrow. Last year the chief executive, Peter Wuffli, left the bank, as it announced write-offs and 1,500 job cuts.

Mr Johansson is joining UBS after 23 years with Morgan Stanley and exactly two months after he was promoted for the second time in a year. At present he is vice-chairman of Europe for the investment banking and securities division.

In 2006 Mr Johansson earned $20.1 million at Morgan Stanley. His earnings for last year will be disclosed this month.

UBS was not available to comment on whether Mr Johansson had been offered an inducement fee, more commonly known as a "golden hello", to join UBS.

Yesterday Credit Suisse reduced its sub-prime mortgage writedowns by SwFr200 million and made a SwFr8.5 billion profit.

Times Recommends

• Minister in talks with Saudis to protect creditors
• Premier Inn hits back in £29-a-room row
• Bankers hit back at 'populist' bonus supertax