UBS CEO signals job cuts will continue in quest to lower costs

UBS Group chief executive officer Sergio Ermotti said he will keep cutting headcount in the wake of the historic acquisition of Credit Suisse.

The Swiss lender seeks to shed another US$5.5 billion in costs in addition to the US$7.5 billion already achieved since the deal, Ermotti said in an interview with Bloomberg News editor-in-chief John Micklethwait in Davos on Tuesday (Jan 21). It’s “inevitable” that this will involve redundancies, though UBS would try to rely on voluntary leavers as much as possible, he said.

UBS’s workforce swelled to roughly 120,000 from below 75,000 previously after the Swiss lender agreed to acquire Credit Suisse in a government-brokered emergency operation almost two years ago. That number has since dropped by about 10,000. UBS has not defined a target headcount.

The other big part of the anticipated total savings of US$13 billion are to come through switching off Credit Suisse’s old IT systems, the bank has said. A big step in that process is set to happen this year as UBS plans to shift client data in its home market Switzerland.

Ermotti said that about 7 per cent of employees leave UBS annually of their own accord.

“We have a lot of people going into retirement,” Ermotti said. “So we hope we can mitigate” the forced job cuts. BLOOMBERG

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