UBS AG will pay around $1.5bn (€1.15bn) to settle charges that a group of traders at its Japanese unit rigged Libor interest rates, a source familiar with the matter said yesterday as the Swiss bank prepares for a deal with regulators.

Deutsche Bank AG, Germany’s largest bank, said fourth-quarter profit fell 76%, more than analysts estimated, as Europe’s debt crisis curbed trading and the company wrote down holdings.

SWITZERLAND’S biggest bank UBS is to axe 3,500 jobs to shave 2 billion Swiss francs (€1.72bn) off annual costs as it joins rival investment banks in reversing the post-crisis hiring binge and preparing for a tough few years.