The merger between Credit Suisse Group AG and UBS Group AG could result in up to 36,000 jobs being cut across the world, the SonntagsZeitung weekly reported yesterday.
The takeover by UBS of Credit Suisse in a US$3.23 billion deal 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 on Wednesday announced it would bring back former CEO Sergio Ermotti to handle the huge risks involved in the Swiss banking giant’s controversial absorption of its troubled rival Credit Suisse.
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The SonntagsZeitung report said management was mulling cutting 20 to 30 percent of the workforce, meaning between 25,000 and 36,000 jobs.
Up to 11,000 jobs could be cut in Switzerland alone, it said, citing internal anonymous sources.
Before the merger, UBS and Credit Suisse had employed slightly more than 72,000 and 50,000 people respectively.
UBS and Credit Suisse, the second-biggest bank in Switzerland, were among the select banks around the world considered to be “global systemically important financial institutions” and therefore deemed too big to fail.
UBS chairman Colm Kelleher said last week: “There’s a huge amount of risk in integrating these businesses.”
Meanwhile, Norges Bank Investment Management is to vote against the re-election of Credit Suisse chairman Axel Lehmann and six other directors at the Swiss lender’s annual general meeting on Tuesday, the Norwegian wealth fund said on its Web site.
“Shareholders should have the right to seek changes to the board when it does not act in their best interest,” it said.
In addition to Lehmann, Norges is also opposing re-election of Credit Suisse directors Iris Bohnet, Christian Gellerstad, Shan Li (李山), Seraina Macia, Richard Meddings and Ana Pessoa.
Credit Suisse declined to comment, and UBS did not immediately respond to a request for comment.
Additional reporting by Reuters
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