UBS looks to axe 30% of staff and keep Credit Suisse’s domestic business

UBS looks to axe 30% of staff and keep Credit Suisse’s domestic business

© Reuters. FILE PHOTO: The logo of Swiss bank UBS is seen at its headquarters in Zurich, Switzerland, October 25, 2022. REUTERS/Arnd Wiegmann/File Photo

By Oliver Hirt and Noele Illien

(Reuters) – UBS is weighing cutting tens of thousands of jobs following its emergency takeover of Credit Suisse, as the Swiss bank leans towards keeping the domestic operations of its fallen rival, according to a person familiar with the discussions.

UBS could axe around 30% of its combined workforce, which has expanded to 120,000 following the state-brokered rescue earlier this year, that person told Reuters on Wednesday.

UBS and Credit Suisse declined to comment.

Credit Suisse’s investment bank, back office, and its Swiss retail bank will bear the brunt of the bloodletting, with at least 7,000 jobs to go in Zurich alone, the person said.

Such plans indicate that UBS wants to absorb Credit Suisse’s domestic business, streamlining operations and cutting costs in the process, a controversial decision which could trigger concerns about the bank’s domestic market dominance.

Relationship managers overseeing large client accounts as well as corporate bankers in Switzerland are likely to be less affected by the cull, the person added.

If implemented, the total job cuts would amount to more than 30,000. Total job losses could reach 35,000, Bloomberg News reported on Tuesday.

The Swiss Bank Employees Association would not comment on the reported numbers, but reiterated its concern about the impact of the bank’s plans.

“The major changes in the financial center would change the face of Switzerland,” it said in a written response to a Reuters request for comment.

“After more than 3 months the uncertainty and frustration are on the rise, also because of such media reports,” the association said, while calling on UBS to cooperate with its social partners on solutions that would ensure financial market stability.

The staff association had previously demanded that UBS keep job cuts to an “absolute minimum”.

Earlier this month, UBS Chief Executive Sergio Ermotti warned of painful decisions about job cuts following the takeover of Credit Suisse, but provided no numbers.

Reuters reported last week reported that UBS will cut Asia investment banking jobs at Credit Suisse next month, with significant reduction in investment bankers covering Australia and China.

UBS completed its emergency takeover of embattled rival Credit Suisse in June, forging a Swiss banking and wealth management giant with a $1.6 trillion balance sheet and overseeing more than $5 trillion in assets.

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