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I was actually a little surprised to see that I opened a position in UBS (NYSE:UBS) yesterday.

After writing last week that I was looking for a large-cap company to add to my portfolio, one that would be more stable than my current holdings but that would still be capable of some solid long term growth, I thought about it over the weekend and decided it would be either 3m (NYSE:MMM) or UBS. Since UBS has been on an uptrend lately I put in a limit order at $101 just in case it dipped a bit for me. I didn't think it had, but apparently for a few minutes on Tuesday morning it hit 101 and I picked up a few shares.

So, surprise surprise, I bought UBS on January 10 at $101.

Though I was surprised, I'm happy to have this company in my corner. UBS is selling at nearly as low a value price as the big US banks, and certainly at a discount to most of the other big integrated financial services companies who have significant private banking and asset management operations. Several of the mutual fund gurus that I respect have UBS positions and make a compelling argument for it's growth prospects, including Bob Smith at T. Rowe Price Growth Stock and the Calamos guys among many others. I do regret that I didn't make this decision at the end of last year, before it had it's recent 10% runup, but in the long term I think this is a fair price to pay.

UBS is a combination of a lot of things, and probably one reason it's not selling at a higher price is the integration struggles they've had over the past couple of years. UBS is the biggest bank in Switzerland (after buying Swiss Bank) and runs the world's largest private bank. It also runs an investment bank (formerly Warburg) and a big brokerage firm (formerly PaineWebber), in addition to doing asset management work around the world. You've probably noticed that you see the UBS name around a lot more lately, and that's because they've rebranded all of these businesses under that single moniker.

What appeals to me about UBS is it's international presence, and particularly it's presence in Japan and elsewhere in Asia. It sounds as though the Japanese are just getting ready to become large investors as well as savers (as befits the world's second largest economy), and UBS is well positioned there to pick up some of the big accounts that are freed up by the privatization of the postal service (which currently holds a huge portion of individual savings accounts). They're not the only ones fighting for Japanese position or for market share in other countries, of course, but they appear to be off to a successful start.

I was very close to deciding to buy Citibank (NYSE:C) instead, but ultimately picked the smaller (not that $100 Billion is small) and more global company. I'm hoping UBS is on a similar growth trend to where Citibank was several years ago -- they're less than half as big and have similar international breadth, so I'm hoping their growth can be more aggressive even if their dividend is significantly lower at the moment.

I probably will not watch UBS that carefully -- I'm interested to see what they do with their dividend policy over the coming year or two, as they're ripe for a new focus on increasing dividends to match their competitors and to get their cash flow into the hands of their investors, but otherwise I think this is a solid, diversified international financial play that touches on all important areas and important world regions, and I'm going to see if they do as well as I think they will. I'll let you know if I change my mind.

Source: UBS: Small and Global (UBS)