The takeover of Credit Suisse by UBS is giving private clients in Switzerland cause for concern. They are taking a look at competing banks.

Uncertainty over what will happen next with Credit Suisse is giving competitors an opportunity to move onto the turf of the newly formed banking giant. Market research institute «Link» determined there is a significant decrease in private individuals who can imagine becoming clients of Credit Suisse, let alone UBS, according to a study released Tuesday.

The findings are based on two representative surveys according to Link. The first was conducted shortly before the March 19 takeover by UBS of Credit Suisse, and the second a week later. 

Uncertainty at UBS

In the days before the takeover, ten percent said they would consider a move to Credit Suisse, which fell to five percent after the takeover. UBS also lost ground, falling to 27 percent from 33 percent.

The beneficiaries were their competitors with the largest market shares which are the Cantonal banks, the Raiffeisen Group, and Postbank Postfinance. Each showed a slight increase in people who would consider switching to those financial institutions, suggesting they could benefit from the takeover.

Moving to «Quality»

In an interview with the «Financial Times» (behind paywall) on Monday, the CEO of Swiss wealth manager Julius Baer, Philipp Rickenbacher, echoed those findings. He said he is seeing clients moving their assets to «quality», with a shift towards more traditional wealth managers and away from the likes of UBS and Credit Suisse. The reason behind this is the riskier business models of UBS and Credit Suisse due to their investment banking operations.

Outperforming Raiffeisen

To be sure, in the run-up to the merger, clients were moving funds out of Credit Suisse. According to its 2022 annual report, 18 billion francs ($19.7 billion) in savings have flowed out of Switzerland, with Raiffeisen reporting liquidity having moved from Credit Suisse into the cooperative bank network last fall.

UBS has to be concerned about convincing clients to keep their money in the new mega institution as quickly as possible. UBS has big plans in Switzerland and is aiming to overtake Raiffeisen as the most important retail bank in the home market, as finews.com reported.