UBS Plans To Lay Off More Than Half Of Its Employees After Taking Over Credit Suisse

(CTN News) – After taking over Credit Suisse Group, UBS Group is planning to cut more than half its workforce.

Sources say that almost all activities in Credit Suisse’s investment bank in London, New York, and some parts of Asia are at risk as a result of the cuts.

Several sources said that the first round of cuts is expected by the end of July, followed by two more in September and October.

After UBS agreed to buy Credit Suisse in a government-sponsored rescue, the full extent of the job cuts has become apparent.

In the wake of the deal, UBS aims to save about $6 billion in staff costs, bringing its combined workforce to about 120,000.

Approximately 35,000 employees will be cut from UBS’ total combined staff, a source reported.

Redburn analysts estimated this month that UBS would cut around 30,000 jobs.

Approximately 45,000 people work at Credit Suisse.

In response to the job cuts, UBS declined to comment.

In addition to the Swiss lender’s layoffs, Wall Street investment banks Morgan Stanley and Goldman Sachs Group have cut thousands of jobs in the financial sector worldwide this year.

The combined firm already reflects UBS’ dominance. Only Ulrich Koerner, chairman of the acquired bank’s executive board, is a Credit Suisse holdover.

Five of the more than two dozen leadership appointments at Credit Suisse are in wealth management.

According to Sergio Ermotti, UBS chief executive, the integration was “very well” on Tuesday.

In 2021, the Archegos Capital Management scandal led to the $5.5 billion loss at Credit Suisse’s loss-making investment bank, which intends to reduce in numbers.

Some of UBS’ top-performing bankers have left or been poached by competitors, despite its plan to keep the top 20% of dealmakers.

Recent recruits from Credit Suisse include employees at Deutsche Bank, Jefferies Financial Group, and Wells Fargo.

According to two people, UBS wants to keep Credit Suisse’s private bankers.

A few hundred Credit Suisse private bankers will be kept at in Asia Pacific, Bloomberg reported earlier this month.

UBS’ flagship office in Singapore will be home to some private bankers as early as next month, a sign that the merger is taking shape.

Credit Suisse will also need to keep, at least in the near term, the people who manage Credit Suisse’s structured loans and equity derivatives business.

The Swiss domestic business will be fully integrated or spun off or listed in the third quarter.

A lot of Swiss companies and politicians are worried about the combined bank’s market power.

People said the initial rounds of job cuts will probably exclude those related to the extensive overlap in Swiss businesses.

One person said the merger would eliminate 10,000 jobs overall. About 30% of the megabank’s combined staff is in Switzerland, split between domestic businesses and corporate functions and asset management.

Ermotti said UBS would keep Credit Suisse’s domestic unit as a “base case scenario”. In meetings this month, Mr Ermotti and chairman Colm Kelleher told employees they expected the businesses to merge, especially after the decline of Credit Suisse’s private banking business.

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