UBS board, management faces opposition on 2013 conduct vote

ZURICH (Reuters) - UBS is set to face opposition from shareholders for its involvement in various scandals, including a global probe into the largely unregulated $5.3 trillion (3.12 trillion pounds)-a-day foreign exchange market, at its shareholder meeting on Wednesday.

Influential proxy advisor Glass Lewis is recommending shareholders deny the Swiss bank's board and management a ratification of their conduct last year.

"We do not believe there is sufficient evidence yet that the company's risk controls are robust enough to warrant ratifying the board and management acts," Glass Lewis wrote in a recommendation to UBS shareholders seen by Reuters.

Glass Lewis said shareholders should be concerned with the extent of the burgeoning forex probe, and be mindful of potentially material fines UBS may have to pay for helping wealthy clients evade taxes.

Shareholder groups including Switzerland's Ethos and ZCapital are recommending shareholders deny approval of pay for 2013, when bonuses for bankers rose by nearly a third after the Swiss bank returned to profit in the fourth quarter.

Previously an annual formality, the vote to ratify board and management has increasingly been used as a means of protest by shareholders.

A yes-vote means the company itself and the shareholders who vote for it would no longer have the option of pursuing legal action against them, unless new information came to light.

The Zurich-based lender, which paid $1.5 billion in 2012 to U.S. and European authorities over alleged efforts to manipulate Libor and other benchmark interest rates, is 18 months into a three-year revamp.

The plan is to scale back its investment bank and derive the bulk of profits from its flagship private banking operations in order to pay richer dividends.

But first, UBS must extract itself from the foreign exchange scandal, as well as several others including claims it misrepresented mortgage-backed bonds during the U.S. housing bubble and back taxes due to Brazil, dating back to when the Swiss lender owned an investment bank in the country.

On Wednesday, UBS Chairman Axel Weber and Chief Executive Sergio Ermotti asked shareholders for more time to clean up with the bank's past.

"We are in a good position and doing the right thing, but we have not yet seen the end of all issues from the past - they will continue to cost the industry and us time and effort," Ermotti told shareholders.

On Tuesday, UBS told shareholders it still expects "elevated" spending to resolve its past. The global forex probe, still at an early stage, is among UBS' biggest problems because the Swiss bank is the world's fourth-biggest currency trader, according to a Euromoney poll.

"Resolving these issues from the past is a top priority for me," Weber told shareholders in his remarks. "We are looking closely at every part of the bank, and will take decisive action at once if we find any misconduct."

(Reporting By Katharina Bart; Editing by Joshua Franklin)