UBS Wealth Management Americas reported net asset outflows of $11.2 billion in the fourth quarter as the division struggled to regain its footing in the competitive U.S. market. UBS blamed the outflows on advisers leaving the firm and taking clients with them as well as limited recruiting of experienced advisers.

UBS had a 21% increase in outflows in the fourth quarter, up from $9.3 billion in the previous quarter. The third-quarter outflows were also up from the second quarter.

The division had 7,084 advisers at the end of last year, down 3% from the previous quarter and 8% from a year earlier.

The firm recently unveiled a new recruitment package in an attempt to attract more high-producing advisers.It wasn't all bad news.

The division reported a 62% increase in pretax profit, to $167 million from the previous quarter. UBS said the improvement was partially because of lower personnel expenses, but was also helped by some one-off items.

UBS was not the only one to lose client assets in the last quarter of 2009. Morgan Stanley Smith Barney had $4.7 billion of net asset outflows in the fourth quarter, following their merger.

"While other firms have seen a better situation going into this year and really started to gain traction, UBS has gotten worse," said Alois Pirker, research director at Aite Group. Pirker said the division's cost-cutting efforts have been effective in terms of boosting profits, "but unless they can stop the outflow, they're going to lose huge market share."

The situation was even worse for UBS' global wealth management and Swiss bank division, which had net asset outflows of $31.1 billion. In a statement announcing the results, UBS said that addressing the cause of net new money outflows remains a priority and management is confident that the firm's reputation will be restored "with tangible results."

Pirker said the real test for the U.S. wealth management division will come with this quarter's results after the new management team has had time to make an impact. "That's when we'll see if the 'McCann factor' has worked," he said. "At the moment it's too early to say if advisors are buying into it."

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