English
Switzerland's largest bank, UBS, has assured its shareholders that its surprise takeover of rival Credit Suisse will pay off, despite backlash from investors and Swiss citizens. Chairman Colm Kelleher described the deal as "a milestone for the industry" but acknowledged it presented a "major challenge for the bank." However, he also spoke of "huge opportunities ahead for the combined bank and the Swiss financial centre as a whole."
The Swiss government turned to UBS after a run on deposits caused Credit Suisse to come close to collapse. The deal involves UBS buying Credit Suisse for CHF3bn ($3.3bn), with more than CHF200bn of support and guarantees from the Swiss government.
Some shareholders expressed frustration at being kept in the dark about the merger, with one describing it as "an insult." Concerns about potential job losses and the new bank's impact on competition were also raised. Vice Chairman Lukas Gaehwiler sought to quell such fears, stating that around 250 banks operated in Switzerland, ensuring enough competition. He also said it was too early to speculate about jobs before the "Herculean task" of the merger was completed, which he expected to happen within a few months. On Sunday, the Swiss daily Tages-Anzeiger reported that the combined group's workforce could shrink by 20-30%.
The executives' pay and bonus packages also came under fire from shareholders, who made Ralph Hamers the best-paid CEO in Switzerland in 2022. UBS has taken the first steps to integrate Credit Suisse by rehiring Sergio Ermotti as CEO to steer the massive takeover, taking advantage of the Swiss banker's experience rebuilding the bank after the global financial crisis. UBS shareholders re-elected Kelleher as chairman and approved board members' and bank executives' compensation.
The Bank of England has approved UBS' takeover of Credit Suisse in Britain, a key market for the Swiss lenders racing to close the rescue deal. UBS also secured a temporary green light from European Union antitrust regulators to complete its acquisition of Credit Suisse but will still have to request clearance under EU merger rules. On Tuesday, executives at Credit Suisse faced their shareholders, and Chairman Axel Lehmann apologised for leading the bank to the verge of bankruptcy.