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the swiss times

UBS CEO: Bank Will Grow By 40% After CS Integration

UBS CEO: Bank Will Grow By 40% After CS Integration

Jue, May 16th 2024

At a recent event, UBS CEO Sergio Ermotti addresses concerns over the bank’s size post-Credit Suisse merger, asserting necessary regulatory updates and denying any state guarantees.

Keystone/GEORGIOS KEFALAS

UBS boss Sergio Ermotti expressed his astonishment at the ongoing public debate about whether UBS has become too big for Switzerland. Speaking at an event organized by the Swiss Institute of International Studies at the University of Zurich, Ermotti highlighted the rapid shift in public perception of UBS from a “savior” to “a future problem.”

Ermotti clarified that UBS and the former Credit Suisse were not of equal size. He projected that by the end of 2026, following the integration process, the merged entity would be only 40% larger than UBS’s size in 2022. He acknowledged the need for some adjustments in the regulatory framework to align with best practices, aiming to fortify UBS’s ability to stabilize independently during crises.

Addressing the option of winding up Credit Suisse, Ermotti argued that the decision by the Confederation and authorities to favor a takeover did not imply that Credit Suisse was too big to fail, pointing out that it had indeed failed. He criticized the post-takeover narrative of flawless decision-making by officials, advocating for a more reflective approach and the importance of learning from past mistakes.

Ermotti also reiterated his stance against the notion that UBS enjoys an implicit state guarantee, calling such claims incorrect. He pointed to differences in how rating agencies assess banks with state guarantees compared to those without, and how these distinctions are reflected in their financing conditions.

©Keystone/SDA

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