UBS eyes 3,000 job cuts

ZURICH

Banking giant UBS said yesterday it plans to fully absorb Credit Suisse's century-old Swiss division and slash thousands of jobs across Switzerland, as it seeks to redress its recently-swallowed rival.

Switzerland's largest bank, which was strongarmed into a $3.25-billion takeover of its closest domestic rival in March to keep it from going under, said it aimed to complete most of the integration by the end of 2026, with more than $10 billion in cost savings by then.

The announcement came as UBS posted its second-quarter income statement, presenting its first results since the mega-merger that rocked Swiss banking was finalised in June.

The results were strong for UBS, which posted a towering net profit of $29.2 billion. Credit Suisse took a $10.1 billion loss over the same period

"Our analysis clearly shows that full integration is the best outcome for UBS, our stakeholders and the Swiss economy," UBS chief executive Sergio Ermotti said.

"The two Swiss entities will operate separately until their planned legal integration for 2024 with the gradual migration of clients onto UBS systems expected to be completed in 2025."

Speaking to analysts after the announcement, Ermotti acknowledged that the plan would lead to significant layoffs, but stressed that "cuts were unavoidable regardless of the selected scenario."

The decision to integrate Credit Suisse's business would result in "around 1,000 redundancies", he said, adding that the overall restructuring was "expected to lead to about 2,000 additional redundancies in Switzerland over the next couple of years."