It remains unclear who will take over as head of the lucrative Swiss business of the combined UBS/CS. Sabine Keller-Busse, the current head of Switzerland at UBS, has put herself in the driver's seat for the top job.
The divisional results for the Swiss home market look out of this world for UBS. While the group had to shoulder a $665 million provision in the first quarter of 2023 in the dispute over toxic loan securities in the US, the Personal & Corporate Banking (P&C) unit increased its pre-tax profit by 40 percent year-on-year to 553 million francs, significantly exceeding market expectations.
UBS reported Tuesday its Swiss business gained nearly 10,000 new customers following Credit Suisse's emergency bailout and booked nearly 9 billion Swiss francs ($10.1 billion) in new money, as well as initiating 1.7 billion francs in new loans.
Overtaking Raiffeisen
With the latest results, the management around Sabine Keller-Busse, the boss of the Swiss business, makes a good case for continuing in their current roles for the mega-merger of the two banks, expected to be formally completed before summer. UBS also took over the local business of Credit Suisse through its forced purchase on March 19, with UBS saying on Tuesday it wants to consolidate its position as a Swiss universal bank. In March, UBS told investors the combination with Credit Suisse would overtake Raiffeisen Group as the country's leading retail bank.
There are a few catches, however. Partly contrary to such ambitions is the Credit Suisse brand being preserved for the time being. To avoid drastic job cuts, and take into account competition law, UBS might be persuaded to run Credit Suisse Switzerland as an independent subsidiary for a determined period.
Pushing the Pace
Aside from that, the question of the leadership of the Swiss universal bank, and Keller-Busse's future, arise. Interestingly, financial industry observers don't see her sitting as firmly in her chair as she might appear to the outside world. A senior banker wishing to remain unnamed, said the current Swiss head of Credit Suisse, André Helfenstein, would likely provide more traction for the combined bank. According to media reports, the first meeting between Keller-Busse and Helfenstein took place at the beginning of April.
Keller-Busse took over as head of the Swiss business at the beginning of 2021 from predecessor Axel Lehmann, who went on to earn the distinction of becoming Credit Suisse's last chairman. As the fourth boss in six years, Keller-Busse has taken the helm of the division, which is rock-solid but languishing in terms of profits, and has been pushing the pace ever since.
Ermotti's Former Right Hand
Under former UBS Group CEO Ralph Hamers, the focus of the digital transformation was on the Swiss market, which had tangible results with its Key4 digital offering. The organization as a whole has become faster thanks to the agile structure, that was the hallmark of Hamers.
Ermotti has to keep all of this in mind when assembling his new team. He made it clear that he will give all employees of the combined bank a fair shot at jobs, and that there are outstanding people at Credit Suisse. It remains to be seen whether he will insist on this with his former right hand. Keller-Busse served as the operational head (COO) under Ermotti.
