UBS Group AG plans to eliminate about 3,000 jobs in its home market as it seeks to cut billions of dollars in costs after buying rival Credit Suisse.
It’s the first time Chief Executive Officer Sergio Ermotti has put a concrete figure on how many jobs the massive merger will cost, though the forced redundancies he disclosed on an analysts call on Thursday are likely only a small part of the total reduction in headcount. The acquisition of Credit Suisse increased UBS’s workforce by 45,000 to currently just under 120,000.
UBS has previously said it wants to slash staff costs by about $6 billion ($5.27 billion) over the next several years, effectively accounting for more than half of Ermotti’s promise to slash costs by more than $10 billion.
UBS announced on Thursday that it will keep Credit Suisse’s Swiss unit, adding a big operation where the two lenders have substantial overlap. The decision came after UBS earlier this month gave up extensive guarantees given by the Swiss government in March to sweeten the takeover.
UBS to keep Credit Suisse’s Swiss business, retire its brand
UBS and Credit Suisse will continue to operate separately in the country until their legal merger next year, UBS said in a statement Thursday. The lender will keep using the Credit Suisse brand and operations until it has moved the former rival’s clients onto its own systems, which is expected to happen in 2025, it said.
The decision “follows a thorough evaluation of all options,” Chief Executive Officer Sergio Ermotti said in the statement. “Our analysis clearly shows that full integration is the best outcome for UBS, our stakeholders and the Swiss economy.”
The Swiss business has been Credit Suisse’s crown jewel, a profitable anchor while the rest of the firm lurched from crisis to crisis over the past years. UBS had long signaled its preference to keep it, but political concerns about its potentially dominant role at home had complicated the decision. The decision to integrate it was made easier after UBS voluntarily gave up a safety net provided by the government.
Bloomberg previously reported that UBS was poised to integrate the Swiss bank and planned to wind down the Credit Suisse brand in the country.