A year ago Credit Suisse staff were stunned by the sudden demise of their bank. Many are now fighting for their careers with 3,000 Swiss posts set to be axed by their new employer UBS, starting this year.
Speaking to Swiss public broadcaster, SRF, one Credit Suisse employee described the takeover by UBS as “surreal”. The staff member, who did not want to be identified, is now in survival mode. “When the going gets tough, you want to be the first to send off job applications – before the big clear-out comes,” he said.
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By the end of last year, the combined banking group, now run by UBS, had shed 16,000 posts with various media predicting that thousands more jobs are set to be slashed.
The first wave of job cuts last year was felt beyond Swiss borders, particularly in New York and London, as UBS pared down Credit Suisse’s problematic investment banking operations.
Other areas of the world have also been affected. UBS plans to shed two-thirds of Credit Suisse investment bankers in the Asia-Pacific region, says Bloomberg. This includes 80% of Credit Suisse investment bankers in Hong Kong, according to Reuters.
Global layoffs
The international media has also reported layoffs in Japan, Singapore, China and Turkey. UBS declines to comment on the details of job cuts.
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Switzerland-based staff have so far been kept busy with the integration of Credit Suisse and UBS operations – a process that will run until the end of 2026. But UBS says redundancies of Swiss staff will begin in the second half of this year.
“The redundancy programme will create tragedies for some individuals,” Erik Wirz, founder and managing partner at the Wirz & Partners Swiss recruitment consultancy, told SWI swissinfo.ch.
“People who have risen through the ranks at Credit Suisse or UBS for 20 or 30 years in the same field, and who have a mediocre academic background, are going to find the job market tough.”
‘Playing their cards right’
Amid the turmoil, some staff stand to benefit. The past few months has seen a raft of Credit Suisse wealth management teams jump ship to other Swiss banks. Others have opted to set up their own independent financial companies rather than wait for UBS to dictate their fate.
And despite accusations of poor management and culture at Credit Suisse, some business units were performing well even as the bank folded.
“Employees in the right positions are playing their cards right now, looking at their options and going back to UBS to negotiate better conditions,” Wirz said. “They are in a position to decide whether they stay or leave.”
Credit Suisse had a reputation as an “entrepreneurial” bank, specialising at serving small and medium-sized businesses that form the backbone of the Swiss economy. This is one area in which Credit Suisse consistently outperformed UBS, Wirz said.
“These teams are a treasure trove for UBS to go hunting for hidden gems. There are some very talented people to pick and choose from. UBS is now fighting to retain them.”
Enhanced competition
“Other Swiss banks are clapping their hands at the shake-up because it creates opportunities for them to recruit teams and gain market share,” Wirz said. “It has created new competition in the banking sector that hasn’t existed for decades.”
UBS does not dispute this fact. “The collapse of Credit Suisse unleashed an extraordinary race for clients, talent and market share in the Swiss banking market,” UBS chair Colm Kelleher and CEO Sergio Ermotti wrote in a recent note to investors.
However, staff working in back-office functions, such as IT support, marketing, human resources and legal services, are starting to look nervously over their shoulders with job cuts expected soon.
“Banks are in essence large tech firms. Everything is underpinned by technology systems and the people who make this machinery work,” William Andreae-Jones, from recruitment firm Robert Walters, told SWI swissinfo.ch. “There is not a massive amount of capacity in the Swiss system to absorb all these people overnight. Most of the banks are fairly well staffed in terms of their infrastructure and there aren’t a vast number of vacancies.”
“But the indicators point to a more phased redundancy programme that will offset that to some degree,” he added.
Ebbs and flows
The Swiss Bank Employees’ Association told SWI swissinfo.ch it was “confident” that most departing Credit Suisse employees would be absorbed by the Swiss financial system, adding that “UBS must provide particularly good protection for older employees, aged 55 and over”.
The impact of redundancies on the Swiss financial sector labour market will be made clear in the next couple of years.
The number of workers has remained relatively stable since the turn of the millennium despite a banking meltdown in 2008 followed by a United States crackdown on banking secrecy. More than 186,000 staff were employed by banks, insurers and other financial companies in 2000, which had increased to 221,000 by the end of 2023, despite some ebbs and flows in the number of workers during the intervening years.
The proportion of financial workers in the total workforce, however, is declining. In 2000, 5.7% of the entire Swiss workforce was employed by banks and other financial companies. That proportion had dropped to 5.18% by the end of 2023.
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Edited by Reto Gysi von Wartburg/Thomas Stephens
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