UBS Group AG will cut its workforce by 20-30 per cent after completing its takeover of Credit Suisse Group AG, slashing as many as 36,000 jobs worldwide, Swiss newspaper Sonntagszeitung reported, citing a senior manager at UBS.
In Switzerland, as many as 11,000 employees will be laid off, the newspaper said on Sunday. The two lenders together employed almost 125,000 people at the end of last year, with about 30 per cent of the total in Switzerland.
That number of predicted layoffs dwarfs the 9,000 job cuts that Credit Suisse had announced before the rescue by UBS last month. Given that the merger creates significant overlaps, it had been expected that final layoffs would reach a multiple of that number.
UBS didn’t immediately respond to a call outside of normal business hours seeking comment.
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The takeover by UBS of Credit Suisse was hastily arranged by the Swiss government on March 19 to prevent a global financial meltdown, following fears of contagion from the collapse of banks in the US.
UBS announced on Wednesday it would bring back former chief executive Sergio Ermotti to handle the huge risks involved in the Swiss banking giant’s controversial absorption of its troubled rival Credit Suisse.
UBS chairman Colm Kelleher said this week: “There’s a huge amount of risk in integrating these businesses.”
Credit Suisse was embroiled in a series of scandals in the years leading up to a March 15 share price collapse, when investor confidence plunged following two bank failures in the US.
Among these was the bankruptcy of the British financial company Greensill and the implosion of the US hedge fund Archegos.
It was also caught up in a bribery scandal in Mozambique involving loans to state-owned companies and was fined $2 million in a money laundering case linked to a Bulgarian cocaine network.
With inputs from Bloomberg and AFP