UBS, Switzerland’s biggest bank, has announced it has undertaken a SwFr3.8 billion (£2.1 billion) capital raising as it warned investors it would make a net loss in the second quarter.

The bank said that it had sold more than 293 million new shares to a small number of investors, thought to be mainly European institutions, at SwFr13 per share.

Swiss regulators have piled pressure on the country’s banks to cut their risks and improve capital buffers. The Swiss National Bank (SNB) last week warned that UBS, one of the banks most affected by the credit crisis, and nearest rival Credit Suisse, have continued to face difficulties despite an easing of market conditions.

In a separate announcement last night, UBS blamed a forecast second-quarter loss on fears about its financial stability that were making it more expensive for the bank to borrow money.

UBS is due to announce its second-quarter results on August 4.

But UBS said that the loss for the three months to June 30 would not be as bad as its SwFr 1.98 billion slide into the red in the first quarter, mainly because of improved investment bank business and smaller losses and writedowns on risky assets.

UBS admitted that more money had been withdrawn from its wealth and asset management divisions than had been placed with the businesses.

But the sale of some of its old risky assets meant that the bank’s Tier 1 capital ratio would be better at the end of June than it had been when the first quarter closed on March 31.

UBS is thought to be aiming for a 13 per cent Tier 1 ratio, up from about 12 per cent.

Philipp Hildebrand, the vice chairman of the SNB, last week threatened to break up Switzerland’s big banks if they did not reduce the threat they posed to financial stability.

"If significant progress is not achieved measures that address the size of the banks should also be examined," Mr Hildebrand said.

The SNB said last week that Swiss banks would have to hold a minimum capital ratio of 12 per cent in the future, rising to as much as 16 per cent when generating above-average profits. This is higher than the capital requirements set out in Basel II, the international banking regulations.

UBS made SwFr21 billion in losses in 2008 after allowing its investment bank to take huge risks. The bank has since shed its chief executive and changed chairman twice, as well as sacking 18,000 staff.

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