UBS (UBS) seems to be axing more jobs across its operations in Asia than it had originally announced earlier this year. The move was triggered by the recent decline in economic growth in the region coupled with a downward revision in the outlook for the region's two most important growing economies, China and India.

In February, the Swiss bank had made plans to cut 35 jobs across Asia-Pacific. UBS is not the only global banking group downsizing its Asian operations, with Deutsche Bank (DB) and Goldman Sachs (GS) also resorting to similar measures.

We maintain a $15 price estimate for UBS, almost 35% above the current market price. We attribute this considerable difference in price to widespread pessimism toward European banks in the wake of deteriorating sovereign debt situation in key eurozone countries.

UBS came up with a radical cost cutting plan in mid-2011 in an attempt to combat rising costs in an environment where financial firms have struggled to make money. The announcement made in July 2011 outlined a plan to reduce nearly 3,500 jobs globally, saving the bank about CHF 2 billion ($2.1 billion) in annual recurring expenses by the end of 2013 (see Proposed Cost-Cutting Measures by UBS Present Substantial Upside).

The bank employs around 6,500 employees in the Asia-Pacific region, which makes the proposed cut of 35 jobs a relatively small downsize. But it does represent a major change in the bank's outlook since late last year, when the bank anticipated a significant growth in its Asia business (see UBS Expects Asia to Boost its Revenues in 2012). The fact that most Asian currencies -- most notably the Indian rupee -- have seen considerable devaluation this year no doubt contributed to this reversal.

Most of the job cuts are believed to have come in the bank's equities business. Given the weak performance of equity trading desks of major investment banks, the move comes as no surprise. We only hope that the cuts help the bank reduce costs enough to compensate for the falling revenues.

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