UBS to cut another USD 3 billion in costs following Credit Suisse deal

The cost-cutting efforts follow the emergency acquisition of the Credit Suisse rival, and they aim to ensure that the deal will actually pay off for UBS. Specifically, the savings will aid with the absorption of Credit Suisse while supporting UBS’s growth trajectory, which will involve investments in talent, products and services. 

According to CNN, UBS revealed that its new savings target has reached USD 13 billion, which is USD 3 billion more than the previous goal announced six months ago. So far, the company has managed to trim USD 4 billion in costs, including through job cuts. Speaking of which, UBS went forward with a series of layoffs in the fourth quarter by more than 3,100 to under 113,000, taking the number of layoffs announced in 2023 above 16,000. 

These fourth quarter job cuts focused on staff previously employed in Credit Suisse’s investment bank according to UBS’ chief financial officer cited by CNN. He also revealed that, while many of these employees the United States and United Kingdom, some of them operated in other parts of the globe. 

The bank is currently in the process of obtaining all the necessary regulatory approvals for the merger, and for the time being, staff working on these tasks are important to retain in order to ensure that everything goes smoothly. However, once these regulatory approvals are obtained, CNN reports that more job cuts are likely to occur. 

For the October-to-December period, UBS reported a net loss of USD 279 million, which followed a loss of USD 785 million for the June-to-September quarter. Regarding the acquisition of Credit Suisse, UBS agreed to purchase it for just USD 3 billion in a rescue put together by Swiss authorities to avoid a meltdown of the banking sector. 

CNN further reveals that UBS reported a profit of USD 29 billion in 2023, which largely reflected an accounting gain booked on the difference between the knockdown price it paid for Credit Suisse and the much higher value of the failing lender’s balance sheet.

Other developments from UBS

In October 2023, UBS announced its partnership with global fintech Broadridge Financial Solutions in order to go live on its newly launched sponsored repo service. 

The new service was built on the DLT-enabled Distributed Ledger Repo platform and it leveraged the growing expansion of the network across its global repo community. The aim of the launch was to give customers and clients the possibility to benefit from significant settlement cost savings, scalability, reduction of operational risks, and process simplification and efficiency via smart contracts and distributed ledger technology.