The job losses will happen over the next three years as UBS expects its headcount to be around 54,000 in 2015 compared with approximately 64,000 today, a reduction of 15%.
The bank is targeting savings of CHF 5.4 billion including incremental cost savings of CHF 3.4 billion above the CHF 2 billion cost savings programme announced in 2011. It has stated it expects restructuring charges of CHF 3.3 billion over the same period.
UBS chief executive Sergio Ermotti said: "This decision has been a difficult one, particularly in a business such as ours that is all about its people.
"Some reductions will result from natural attrition and we will take whatever measures we can to mitigate the overall effect."
Ermotti added: " Throughout the process we will ensure that our people will be supported and treated with care."
UBS will now move the focus to its private bank and smaller investment bank, losing much of the trading business that saw it lose £31.146 billion in the financial crisis.
Trader, Kweku Adoboli is on trial in London accused of gambling away a record £1.4 billion on unauthorised deals while working for the Zurich-based firm.
In a joint letter to shareholders, chairman Axel Weber and chief executive Ermotti said: "We will no longer operate to any significant extent in businesses where risk-adjusted returns cannot meet their cost of capital."
