The merger of the Swiss banks UBS and the problematic Credit Suisse may lead to the cancellation of up to 36,000 jobs worldwide. This was reported by the SonntagsZeitung weekly and the Tages-Anzeiger newspaper on Sunday.
The bank, which will be created by the takeover of Credit Suisse by rival UBS, is ready to reduce the number of its employees by 20 to 30 percent, which means 25 to 36 thousand jobs. In Switzerland alone, up to 11,000 jobs could be cut, SonntagsZeitung and Tages-Anzeiger wrote, without detailing which posts would be affected.
Before the merger, UBS employed slightly more than 72,000 people and Credit Suisse approximately 50,000 people.
Concerns about the size of the new bank
UBS has agreed to buy Zurich-based rival Credit Suisse for 3 billion Swiss francs (3.31 billion euros) in a deal brokered by the Swiss government, central bank and market regulator to prevent the country’s financial system from collapsing. The deal was also supposed to help ensure financial stability around the world, but raised concerns about the size of the new bank, which has $1.6 trillion (€1.47 trillion) in assets and more than 120,000 employees worldwide.
UBS said on Wednesday it would bring back former chief executive Sergio Ermotti to manage the huge risks associated with the controversial absorption of troubled rival Credit Suisse.
UBS and Credit Suisse, Switzerland’s second-largest bank, are among the financial institutions that are considered global systemically important (G-SIFIs) and too big to fail.
A series of Credit Suisse scandals
Credit Suisse has been hit by a series of scandals in recent years, including the collapse of the British financial company Greensill, in which it invested $10 billion, and the collapse of the American hedge fund Archegos Capital Management, which brought a loss of $5.5 billion.
Shares in Credit Suisse fell sharply on Wednesday (March 15) after its main shareholder Saudi National Bank refused to provide another financial injection, citing regulatory restrictions.
Credit Suisse was also caught up in a bribery scandal in Mozambique involving loans to state-owned companies. And she was fined $2 million in a money laundering case linked to a Bulgarian cocaine ring.
Don’t overlook
Credit Suisse helped wealthy Americans avoid taxes for years, whistleblowers say