News

Credit Suisse (I): CS brand to disappear

The demise of big bank Credit Suisse (see also “Swiss Review” 4/2023) continues to make headlines, with UBS bosses announcing at the end of August that Credit Suisse (CS) is to disappear as a brand in its own right by 2025 once UBS has fully absorbed CS’s Swiss business. UBS pledged on 19 March 2023 that it would take over the ailing bank, its erstwhile competitor. Back then, it remained unclear whether and in what form CS would be able to continue as an independent entity. (MUL)

Credit Suisse (II): Massive job cuts

At the end of August, UBS CEO Sergio Ermotti halted speculation over the fallout from Credit Suisse (CS), saying the integration of CS into UBS would result in 3,000 job cuts. External banking experts expect this number to be a lot higher, because Ermotti’s figure does not include jobs abroad, early retirements or voluntary terminations. The “Neue Zürcher Zeitung” (NZZ) reported that around 27,000 jobs were likely to go, according to financial experts, with thousands of external specialists also set to lose their jobs on top of the many layoffs and departures. With Ermotti having earmarked 10 billion Swiss francs in cost savings, 27,000 job cuts are a minimum estimate, says the NZZ. (MUL)

Credit Suisse (III): UBS notches up a huge profit

UBS also appears to have benefited from its takeover of ailing Credit Suisse (CS), having posted a net profit of 29 billion US dollars in the second quarter of 2023 – the quarter that followed the spectacular buyout. It cost 3 billion Swiss francs for UBS to acquire its struggling competitor. The boost in earnings suggests that the value of CS was much higher. This is also good news for the Swiss authorities, with UBS deciding at the start of August to ditch a public liquidity backstop from the Swiss National Bank that was guaranteed by the federal government. UBS also terminated a 9-billion-franc loss protection agreement with the government. However, the last big bank standing remains an enormous risk for Switzerland given its de facto state guarantee, warn experts. (MUL)

SBB carrying more passengers than ever before

Swiss Federal Railways (SBB) is back in profit for the first time since 2019, having raked in 99 million Swiss francs in the first half of 2023 – a significantly improved result over the corresponding period in the previous year. The latest passenger figures are not only back to pre-pandemic levels, but are even surpassing them. A record 1.33 million people travelled by train in the first half of 2023. (MUL)