UBS Zurich building targeted by paint attack

(Corrects to make clear building hit was not UBS headquarters)

ZURICH, Jan 18 - Vandals threw paint at a major office building in Zurich used by UBS, once an icon of sober Swiss banking, now a domestic embarrassment for many after the company had to be rescued by the state following risky U.S. investments.

In a sign of growing distress among usually reserved Swiss, an identified group of people splashed red, green and pink paint late on Saturday over the facade of the UBS office on Paradeplatz, one of Switzerland's most expensive squares.

The paint attack comes less than two weeks before a major anti-capitalist demonstration in Geneva planned by hard-left and anarchist activists on Jan. 31 to coincide with the annual World Economic Forum in Davos.

"Approximately 30 persons took flight at the sight of a Zurich city police car patrol," police said in a statement.

"Police arrested two persons for closer examination."

Several tires had also been put on fire and placed outside the bank's headquarters, police added.

UBS declined to comment.

The bank suffered another paint attack in 1998, when a group protested against the merger of Union Bank of Switzerland with Swiss Banking Corporation.

Onunday morning cleaners were busy removing the paint, which reached the third floor of the UBS building and caused damage for tens of thousands of Swiss franc, the police said.

The attack follows a relentless media campaign against UBS, which fell from grace in the Swiss public eye after revealing it had lost billions to hefty investments in the now collapsed U.S. subprime mortgage market.

The bank giant had to be rescued by the state through a 6.0 billion Swiss franc ($5.37 billion) cash injection, causing anger among Swiss taxpayers and sparking street protests against the bank, an unusual sign in Switzerland.

Nearly 1,000 people demonstrated in November against the salaries of top bankers outside the main offices of UBS and Credit Suisse, Switzerland's other main bank.

UBS subsequently announced some of its top managers were giving bonuses back or refraining from getting any as well as plans to reform its pay structure.

Credit Suisse, which has suffered less in the crisis and has not needed government help, also announced some changes in the way it pays its senior executives at the end of last year.