© Reuters. FILE PHOTO: The logos of Swiss financial institution Credit score Suisse and UBS are seen in Geneva, Switzerland, June 7, 2023. REUTERS/Denis Balibouse/File Photograph
ZUG, Switzerland (Reuters) – The brand new expanded UBS will not be too massive for Switzerland following the financial institution’s emergency takeover of fallen rival Credit score Suisse, Chief Govt Officer Sergio Ermotti stated on Tuesday.
“UBS will not be too massive – measurement will not be solely in regards to the relationship of the steadiness sheet to the nation’s GDP,” Ermotti advised an occasion in Zug, Switzerland.
UBS accomplished its emergency takeover of Credit score Suisse in June, forging a Swiss banking and wealth administration large with a $1.6 trillion steadiness sheet.
The determine is much bigger than all the financial output of Switzerland which stood at $878 billion in 2022 at present alternate charges.
Ermotti stated 20% of the mixed financial institution’s steadiness sheet was comparatively steady and invested within the Swiss property market, whereas the financial institution had greater than $200 billion in loss-absorbing capital.
The manager, who returned to UBS in April to steer the Credit score Suisse takeover, was additionally crucial of Credit score Suisse.
“Credit score Suisse went beneath as a result of it had a enterprise mannequin for years which was merely not proper. The financial institution sadly made billions in working losses over the previous few years and will have gone on making losses,” he stated.
“The financial institution was now not viable.”
Credit score Suisse failed after rattled traders withdrew billions after a sequence of losses and missteps, triggering a liquidity disaster.
Ermotti stated a number of the cash had been transferred to UBS, whereas some had gone to different banks in Switzerland and even overseas.
Nonetheless, he was optimistic that Credit score Suisse might be built-in efficiently into UBS.
UBS final week stated it will scale back prices by $10 billion , saying it would axe 3,000 jobs in Switzerland alone.
“Greater than 99% of the folks at Credit score Suisse are good folks, folks with integrity,” Ermotti stated.
“I do not suppose will probably be an issue to combine Credit score Suisse,” he stated.
