Subsequent 12 months might be one of the tough within the means of absorbing Credit score Suisse into UBS Group AG because of the “sticky” prices concerned earlier than the 2 lenders are legally fused, UBS Chairman Colm Kelleher mentioned.
“If you do an integration as massively sophisticated, the straightforward a part of the preliminary job loss is while you eliminate headcount,” Kelleher mentioned on the FT International Banking Summit in London on Tuesday. The financial institution has “over-delivered” on the combination to this point, he mentioned.
The Swiss financial institution continues to make progress on a multi-year integration and restructuring of its former rival which it acquired in an emergency rescue in March. The mixing comes with a raft of potential difficulties from closing out positions to managing the authorized liabilities inherited from Credit score Suisse.
“We have now to close down all of Credit score Suisse’s authorized entities, switch all of that knowledge throughout earlier than we will even eliminate these control-functions and the related prices,” he mentioned.
“In 2024 we’re very targeted on ensuring that we merge the mother or father banks legally and successfully, decommission what was Credit score Suisse AG, merge the large subsidiaries,” Kelleher mentioned. “And that may then enable us to sort out the problem of price.”
UBS inventory might be “completely revalued” in 5 years’ time if the combination of Credit score Suisse is dealt with efficiently, Kelleher mentioned.
The Zurich-based financial institution posted a internet lack of $785 million for the three months to September, its first quarterly loss in nearly six years, as prices to soak up Credit score Suisse got here in at $2 billion. On the identical time the financial institution reported stronger-than-expected shopper inflows in its wealth-management enterprise, boosted by the primary indicators of stabilization at Credit score Suisse.
This text was supplied by Bloomberg Information.