'Despite recent extremely volatile market conditions, UBS currently expects to report a small profit for the third quarter, based on preliminary estimates,' the bank said.

Switzerland's largest bank has been one of the European banks hardest hit by the US property market meltdown, so the news was cheered by analysts and investors, who drove the bank's shares up 9.2 per cent to 21.54 Swiss francs in Zurich trading.

UBS expects an overall net profit in the coming year, the company's chairman Peter Kurer said in a speech published ahead of Thursday's extraordinary shareholders meeting in Basel.

The bank also said it has further reduced its exposure to the subprime-related investments that caused it to make massive writedowns, starting a year ago.

At Thursday's meeting in Basel, shareholders will be asked to approve four new candidates for the board of directors and abolish the powers of the chairman's office, which has been blamed for failing to oversee risky investment strategies.

Among those up for election are Mr William G. Parrett, retired chief executive of Deloitte Touche Tohmatsu; Mr Bruno Gehrig, chairman of Swiss Life Holding and vice chairman of Roche Holding AG; Mr Rainer-Marc Frey, who has held senior positions in a number of investment management companies; and Ms Sally Bott, group human resources director of BP PLC.

The new board will oversee a shift away from UBS's integrated business model, which has been criticised for a lack of risk management.

Instead, the bank will separate its businesses into three divisions - wealth management for the rich, asset management and investment banking.

Mr Kurer said job cuts and cost reductions would be part of the adjustment process, but declined to provide any details.

A US Justice Department investigation into allegations that UBS helped wealthy Americans avoid billions of dollars in taxes is also a top priority for the bank, Mr Kurer said.

'Some facts of this case involved behavior by employees of ours which we do not and will not tolerate,' he said.

Mr Kurer said board members would closely supervise the bank's efforts to resolve the dispute with Washington and end its offshore banking services for American clients outside of US tax authority control. -- AP