SCANDAL-HIT UBS admitted internal financial controls were “not effective” when alleged rogue trading took place at the bank – as it revealed the action had triggered a 39% slump in profits.

The Swiss bank posted a third-quarter profit of £709.8m after £1.3bn was allegedly lost by trader Kweku Adoboli.

UBS said an investigation had discovered monitoring controls – designed to ensure trading activity was valid and recorded – were not in place on December 31 last year.

Former UBS trader Adoboli, 31, was last month charged with committing false accounting between October, 2008, and September this year and fraud between May and September this year. He has yet to enter a plea against the charges.