UBS reports quarterly loss of $785 million; first since 2017 amid Credit Suisse merger

UBS Group reported a third-quarter loss of $785 million on Tuesday, primarily due to expenses amounting to $2.1 billion associated with its acquisition of the beleaguered rival, Credit Suisse. This figure contrasted with the $444 million loss predicted for UBS shareholders in an analyst survey. Excluding the effects of the takeover, UBS reported an underlying profit of $844 million.

Sergio Ermotti, the Chief Executive, stated, "We are executing on the integration of Credit Suisse at pace and have delivered underlying profitability for the Group in the first full quarter since the acquisition."

Since the completion of this unprecedented merger of two globally significant banks in June, UBS has been diligently working to stabilise its acquisition. The bank attracted a combined total of $18 billion in net new assets in wealth management, of which $3 billion originated from Credit Suisse.

Following the acquisition, UBS now oversees a portfolio of assets exceeding $5 trillion. To regain clients who had withdrawn funds from Credit Suisse, the bank has been reportedly offering above-market deposit rates. Furthermore, it is striving to retain clients who previously held funds in both banks and might be considering risk diversification.

Job Cuts

As of the end of September, UBS reported a workforce of 115,981 employees, a decrease from the 119,100 full-time equivalents at the combined bank at the end of June.

UBS had previously announced plans to cut several jobs, including 3,000 in Switzerland, as part of its cost-saving initiatives following the merger.

New Appointment

Ramzi Issa, renowned for his pioneering role in the ESG debt-swap market while at Credit Suisse, has recently assumed a senior position at UBS Group this week. He now heads the global divisions responsible for structured credit and sustainable credit products in the aftermath of a government-engineered acquisition. This appointment signals the potential for experts from Credit Suisse to secure prominent roles within the merged bank.

Issa's leadership played a pivotal role in shaping the debt-for-nature-swap market, an innovative approach enabling governments to refinance their debts while committing to environmental conservation initiatives. During his tenure at Credit Suisse, the bank replaced $2.3 billion of government debt with $1.2 billion in new funding directed towards environmental preservation.

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