UBS looks to cancel 3,000 jobs in a bid to cut costs by more than $10bn. These Swiss employment positions are under the axe after the $3.2bn UBS-Credit Suisse merger in June this year. The company move surprised more than a few, as the multinational financial institution raked in a record pre-tax profit of $29bn in Q2.
UBS looks to axe 3,000 jobs in $10bn cost-cutting attempt
The bank, however, indicated these earnings were mostly assets acquired after the Credit Suisse takeover. The planned job cuts reflect the magnitude of the reshuffling needed after anxious clients withdrew billions when the Credit Suisse writing appeared on the wall.
Don’t miss out the latest news, subscribe to LeapRate’s newsletter
As workforce reductions create the most savings, this action will ripple to UBS’s global operations and can see a loss of up to 35,000 jobs worldwide. The initial 3,000 Swiss jobs will not be a once-off reduction, but will occur over the next few years. In a memorandum to staff, Sergio Ermotti, the UBS CEO, stated:
The vast majority of cost reductions will come from natural attrition, retirements and internal mobility.
In the report detailing the bank’s Q2 financials, Ermotti also indicated that, after careful consideration, full integration of Credit Suisse appears to be the best for all involved, including the Swiss economy. He said:
Our decision on Credit Suisse (Schweiz) AG follows a thorough evaluation of all available options. Our analysis clearly shows that full integration is the best outcome for UBS, our stakeholders and the Swiss economy. Clients will continue to receive the premium level of service they expect, benefiting from enhanced offerings, expert capabilities and global reach. Our stronger capital base will enable us to keep the combined lending exposures unchanged, while maintaining our risk discipline.
