UBS AG sought Thursday to break with its troubled past, saying it won't pursue previous management in court for their role in hefty losses or for failing to prevent illegal practices in its dealings with wealthy U.S. clients.

The Zurich bank lacks what one expert termed "the smoking gun" to make a plausible legal case against executives like Marcel Ospel, chairman until 2008, and doesn't want to get involved in a lengthy, costly and messy public legal skirmish, chairman Kaspar Villiger said. UBS is also wary of endangering its position in ongoing U.S. proceedings, including one looking into alleged bid-rigging and price-fixing in the municipal finance market.

UBS said the outcome of such action was uncertain and would be unlikely to recoup much from former executives. Several, including Ospel, Peter Wuffli and Marcel Rohner — chief executives until 2007 and 2009, respectively — have relinquished or returned pay totaling 70 million Swiss francs ($73.7 million).

Still, chairman Villiger struck a conciliatory tone with shareholders, who had refused to absolve former managers and board members including Ospel and Wuffli for 2007, when over $50 billion of mortgage-related writedowns for UBS began unfurling.

"What happened should not have been allowed to happen," Villiger, a former Swiss finance minister, said at a press conference. After a near-total revamp of its management, led by former Credit Suisse Group boss Oswald Gruebel, UBS needs to draw a line under its past and concentrate on its future, he said.

Past transgressions include breaking U.S. law by providing hidden offshore accounts to wealthy Americans, many of whom did not declare the funds to the Internal Revenue Service. Villiger said UBS failed to adequately control the U.S. offshore business — since closed down — and that mistakes flourished due to an aggressive hunt for net new assets, which is a key metric for future revenue at private banks.

Specifically, Villiger condemned UBS's former managers for linking private banker bonuses with their net new money, a practice he said ultimately watered down UBS's control of what funds it took.

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