UBS suffered another loss in the final quarter of 2023 due to the takeover of Credit Suisse, but achieved a record accounting profit for the year as a whole. The big bank is making progress with the integration. UBS boss Sergio Ermotti on profit, trust and legacy issues.
Sergio Ermotti
CEO of UBS
Open the people box. Close the people box
Sergio Ermotti has been CEO of UBS since April 2023. He already held this position between 2011 and 2020.
SRF News: UBS has become significantly larger. But the costs put pressure on the bottom line profit. Sergio Ermotti, when can UBS really profit from the takeover of CS?
Sergio Ermotti: We expect to achieve net profitability in the first quarter of this year.
When it comes to asset management, customers’ opinions also count so that they bring their money to UBS. The bank is recording inflows. Are you happy with the numbers?
Yes, since the CS acquisition it has been $77 billion. The momentum was also pretty good in the fourth quarter at 22 billion – and not just among wealthy customers, but also in our business in Switzerland: a third of these 22 billion were invested here.
Apparently you were able to make up for the trust that was lost at CS.
Yeah, I think it was pretty good from the start. As early as the end of June 2023, in the third and fourth quarters. As I said: This momentum, this stabilization of the CS, was clear.
I think the issue of stability and strength of the bank is not an issue for our customers.
We have positive inflows at CS and, as before, at UBS. I think the issue of stability, the strength of the bank, is not an issue for our customers.
Integrating CS costs a lot of money. The bank wants to save 13 billion francs annually by 2026. So far there has been talk of 10 billion. Will there be more in the end?
I don’t think so and I hope not because that would mean we haven’t met our earnings targets. We plan sustainably. Saving the 13 billion is necessary to regain profitability. Unfortunately, Credit Suisse is losing billions. Restructuring is needed – it’s not just synergies.
In order to maintain our competitiveness, we must continue to invest.
Part of this 13 billion, which is very important, will be invested. This, for example, to strengthen the infrastructure, the IT infrastructure and our services. Added to this is growth. In order to maintain our competitiveness, we certainly have to continue to invest.
The largest cost item in a bank is traditionally personnel costs. Further full-time positions were also cut in the fourth quarter. What’s next for the staff?
Yes, unfortunately staff is a significant part of the cost-saving program – certainly a good half. There are also IT systems and real estate. Unfortunately, this must continue. Nothing has changed much compared to what we communicated in the summer. We continue to proactively plan to cut 3,000 jobs in our Swiss business.
At the same time, you reduce CS’s legacy burdens. How are you moving forward?
We made good progress there in the fourth quarter and reduced almost 6 billion francs. And yes, our goal is that this part of the balance sheet does not account for more than 5 percent at the end of 2026.
The legal merger with CS is also planned for mid-2024. Then the Credit Suisse brand will probably disappear too, right?
This is unlikely to happen before the end of the year or the beginning of 2025.
The interview was conducted by Sven Zaugg.