Tens of thousands of jobs at risk after UBS takeover of Credit Suisse

UBS’s rescue of Credit score Suisse is anticipated to lead to tens of hundreds of job cuts, with Switzerland’s monetary sector already bracing itself for a heavy hit from the contentious takeover.

Credit score Suisse’s home enterprise and its funding financial institution, which collectively make use of greater than 30,000 employees, are anticipated to bear the brunt of the cuts, in keeping with folks conversant in UBS’s plans.

These folks added that it was too early to quantify what number of roles would go, nevertheless it could possibly be as a lot as a 3rd of the 120,000 jobs within the mixed group, as UBS winds down a lot of the funding financial institution and removes overlapping roles in Switzerland.

“The takeover threatens job cuts on a scale that the labour market within the banking sector can’t not soak up,” mentioned Switzerland’s Financial institution Staff’ Affiliation on Tuesday, calling for redundancies to be paused till the tip of the yr. 

The deal was orchestrated by the Swiss authorities over the weekend after they grew to become alarmed on the fee of buyer withdrawals Credit score Suisse was struggling final week.

The SFr3bn ($3.25bn) deal has been criticised for the losses incurred by bondholders and the dearth of a shareholder vote on the union.

Credit score Suisse, which on the finish of 2022 employed simply over 50,000 folks, was already in the midst of a wide-ranging job-cutting drive, with 4,000 positions slashed to date this yr.

However the takeover is anticipated to lead to lots of Credit score Suisse’s 17,000 funding bankers dropping their jobs as UBS winds down a lot of the unit.

UBS, which employs 74,000 employees globally, can even look to take away overlapping Credit score Suisse roles in Switzerland, shut branches and cut back employees in administrative positions, in keeping with folks with data of the plans.

In a name with analysts on Sunday night time following the announcement of the deal, UBS chief govt Ralph Hamers mentioned they might attempt to take away $8bn of prices a yr by 2027, with $6bn coming from a discount in employees and $2bn on IT spending.

Credit score Suisse spent SFr8.8bn on staffing prices final yr.

In a employees memo on Monday, Credit score Suisse chief govt Ulrich Körner and chair Axel Lehmann mentioned any choices over jobs had but to be made.

“We [will] work diligently and at tempo all through the approaching interval to establish which roles may be impacted,” they mentioned. “The place obligatory, we are going to talk with impacted people in step with nation particular pointers and insurance policies.”

The takeover is ready to finish within the second half of the yr.

Ethos Basis, which represents Swiss institutional traders that collectively personal between 3 per cent and 5 per cent of each banks, mentioned it was urgent Swiss authorities and UBS to spin off Credit score Suisse’s home enterprise, which employs slightly below 17,000 folks.

“This might protect jobs and keep a wholesome competitors, which might guarantee the correct functioning of our economic system,” mentioned Ethos.

Individually, the Swiss Financial institution Staff Affiliation has known as on Credit score Suisse’s administration crew to arrange a process drive to handle the chance of mass job cuts.

“There is a gigantic quantity at stake for the 17,000 or so workers of Credit score Suisse in Switzerland — and thus additionally for our nationwide economic system,” it mentioned.

Video: Credit score Suisse: what subsequent for the crisis-hit financial institution? | FT Movie

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