(Bloomberg News) UBS AG, Switzerland's biggest bank, announced that its loss from unauthorized trading amounted to $2.3 billion, more than initially reported, while Chief Executive Officer Oswald Gruebel said he will stay on.

The loss, first estimated on Sept. 15 at $2 billion, came from trading in Standard & Poor's 500, DAX and EuroStoxx index futures over the past three months, the Zurich-based bank said in a statement yesterday. UBS made the latest disclosures two days after London police charged a 31-year-old trader with fraud and false accounting.

"The positions taken were within the normal business flow of a large global equity trading house as part of a properly hedged portfolio," UBS said in the statement. The magnitude of the risk was masked by "fictitious positions," it said.

Gruebel, 67, who joined UBS out of retirement in 2009 after record losses during the financial crisis led to a government rescue, told Swiss newspaper Der Sonntag that he doesn't plan to resign because of the loss. His comments were confirmed by spokesman Serge Steiner. In a separate interview, he told Swiss TV that he is ultimately responsible and will have to "take the consequences." Gruebel, whose career in finance spans half a century, is a former trader who also led UBS's biggest Swiss rival, Credit Suisse Group AG.

'The Sword'

"It shows that in the end even a guy like Gruebel who knows a lot about investment banking cannot avoid a catastrophe," said Tobias Straumann, a financial historian at the University of Zurich who was commissioned by UBS to conduct a probe into its internal controls during the subprime crisis. He found the management "complacent" and criticized it for relying too much on internally produced risk management reports.

Questions remain over whether investment-banking chief Carsten Kengeter or other senior executives will be pushed out following the loss.

"The sword will have to go up the food chain," Jason Kennedy, chief executive officer of Kennedy Group, a London- based search firm, said in a phone interview.

While the bank said the trading losses occurred over the past three months, London police charged UBS trader Kweku Adoboli with false accounting offenses dating to October 2008, and fraud dating back to January 2009, according to the court charge sheet.

Adoboli didn't enter a plea, and his law firm, London-based Kingsley Napley, declined to comment.