UBS executives sought to assure investors on Wednesday that Switzerland's largest bank can make its unexpected takeover of Swiss rival Credit Suisse work and pay off for its shareholders.
While describing the biggest bank rescue since the global financial crisis as a milestone for the industry and a major challenge for the bank, chairman Colm Kelleher told UBS shareholders it also meant "a new beginning and huge opportunities ahead for the combined bank and for the Swiss financial centre as a whole".
Last month, Swiss authorities announced that UBS would buy Credit Suisse in a shotgun merger to stem further banking turmoil after the smaller lender had come to the brink of collapse.
After a run on deposits, the Swiss government had turned to UBS, which agreed to buy Credit Suisse for 3 billion Swiss francs ($3.3 billion), while the Alpine state put up more than 200 billion francs of support and guarantees.
Mr Kelleher told the bank's shareholder meeting in Basel that UBS was confident in its ability to successfully manage Credit Suisse's integration and that the combined bank would remain well capitalised.
"We believe the transaction is financially attractive for UBS shareholders," he said.
The hastily arranged rescue not only angered and unsettled shareholders but also many in Switzerland.
A survey by political research firm gfs.bern found a majority of Swiss did not support the deal that would create a financial institution with assets double the size of the country's annual economic output.
As shareholders expressed their frustration about being kept in the dark, with one calling it "an insult", some also voiced concerns about potential job losses and the new giant bank's adverse effect on competition.
Vice chairman Lukas Gaehwiler sought to quell such fears saying there were about 250 banks in the country and therefore enough competition.
He also said it was too early to speculate on jobs before the "Herculean task" of the merger had completed, which he expected to happen within a few months.
On Sunday, Swiss daily Tages-Anzeiger cited an unnamed senior UBS manager as saying that the workforce of the combined group could shrink by 20 to 30 per cent.
Mr Gaehwiler also said that "all options are on the table" concerning Credit Suisse's domestic business, which would continue to operate under its old brand in Switzerland for the foreseeable future.
Shareholders also took aim at the executives' pay and bonus packages, which made Ralph Hamers the best paid chief executive in Switzerland last year.
In contrast to its smaller rival, UBS had been on a steady course. It reported a net profit of $7.6 billion for 2022 and strong inflows in wealth management, the company's flagship division.
Looking at how to navigate the mammoth task of integrating Credit Suisse, the success of which Switzerland depends on, UBS has already taken the first steps.
Last week, the bank announced it had rehired Sergio Ermotti as chief executive to steer the massive takeover — a surprise move to take advantage of the Swiss banker's experience of rebuilding the bank after the global financial crisis.
Addressing shareholders for the last time as chief executive, Mr Hamers acknowledged the merger had led to new priorities for the bank, bringing a change at its helm.
"The acquisition of Credit Suisse will be a major challenge," he said, while echoing the bank's chairman in highlighting new opportunities.
"It is expected to create a business with more than $5 trillion in total invested assets," he said.
On Wednesday, UBS shareholders re-elected Mr Kelleher as chairman, as well as all existing members of the board of directors, and approved their and bank executives' compensation.
Wednesday also marked Mr Ermotti's first official day back in the job, although he did not attend the meeting.
It came a day after executives at Credit Suisse faced their own shareholders and chairman Axel Lehmann apologised for leading the bank to the verge of bankruptcy.
In the face of growing criticism, Switzerland's financial regulator deflected blame for the collapse of Credit Suisse, saying it had been quick to respond, calling instead for more powers to take lenders to task.
On Tuesday, Reuters also reported that the Bank of England had approved UBS's takeover of Credit Suisse in Britain, a key market for the Swiss lenders racing to close the rescue deal.
UBS also secured temporary approval from the EU antitrust regulators to complete its acquisition of Credit Suisse, but will still have to request clearance under EU merger rules, the European Commission said.
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Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
The Bio
Hometown: Bogota, Colombia
Favourite place to relax in UAE: the desert around Al Mleiha in Sharjah or the eastern mangroves in Abu Dhabi
The one book everyone should read: 100 Years of Solitude by Gabriel Garcia Marquez. It will make your mind fly
Favourite documentary: Chasing Coral by Jeff Orlowski. It's a good reality check about one of the most valued ecosystems for humanity
UAE currency: the story behind the money in your pockets
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More from Rashmee Roshan Lall
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
Results:
5pm: Conditions (PA) Dh80,000 1,400m | Winner: AF Tahoonah, Richard Mullen (jockey), Ernst Oertel (trainer)
5.30pm: Handicap (TB) Dh90,000 1,400m | Winner: Ajwad, Gerald Avranche, Rashed Bouresly
6pm: Maiden (PA) Dh80,000 1,600m | Winner: RB Lam Tara, Fabrice Veron, Eric Lemartinel
6.30pm: Handicap (PA) Dh80,000 1,600m | Winner: Duc De Faust, Szczepan Mazur, Younis Al Kalbani
7pm: Wathba Stallions Cup (PA) Dh70,000 2,200m | Winner: Shareef KB, Fabrice Veron, Ernst Oertel
7.30pm: Handicap (PA) Dh90,000 1,500m | Winner: Bainoona, Pat Cosgrave, Eric Lemartinel
UAE currency: the story behind the money in your pockets
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
Profile
Company: Justmop.com
Date started: December 2015
Founders: Kerem Kuyucu and Cagatay Ozcan
Sector: Technology and home services
Based: Jumeirah Lake Towers, Dubai
Size: 55 employees and 100,000 cleaning requests a month
Funding: The company’s investors include Collective Spark, Faith Capital Holding, Oak Capital, VentureFriends, and 500 Startups.
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The specs
Engine: 2.0-litre 4-cylinder turbo
Power: 240hp at 5,500rpm
Torque: 390Nm at 3,000rpm
Transmission: eight-speed auto
Price: from Dh122,745
On sale: now
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
ELIO
Starring: Yonas Kibreab, Zoe Saldana, Brad Garrett
Directors: Madeline Sharafian, Domee Shi, Adrian Molina
Rating: 4/5
Our legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
The most expensive investment mistake you will ever make
When is the best time to start saving in a pension? The answer is simple – at the earliest possible moment. The first pound, euro, dollar or dirham you invest is the most valuable, as it has so much longer to grow in value. If you start in your twenties, it could be invested for 40 years or more, which means you have decades for compound interest to work its magic.
“You get growth upon growth upon growth, followed by more growth. The earlier you start the process, the more it will all roll up,” says Chris Davies, chartered financial planner at The Fry Group in Dubai.
This table shows how much you would have in your pension at age 65, depending on when you start and how much you pay in (it assumes your investments grow 7 per cent a year after charges and you have no other savings).
|
Age
|
$250 a month
|
$500 a month
|
$1,000 a month
|
|
25
|
$640,829
|
$1,281,657
|
$2,563,315
|
|
35
|
$303,219
|
$606,439
|
$1,212,877
|
|
45
|
$131,596
|
$263,191
|
$526,382
|
|
55
|
$44,351
|
$88,702
|
$177,403
|
MATCH INFO
Norwich City 1 (Cantwell 75') Manchester United 2 (Aghalo 51' 118') After extra time.
Man of the match Harry Maguire (Manchester United)
'How To Build A Boat'
Jonathan Gornall, Simon & Schuster
Specs
Engine: Electric motor generating 54.2kWh (Cooper SE and Aceman SE), 64.6kW (Countryman All4 SE)
Power: 218hp (Cooper and Aceman), 313hp (Countryman)
Torque: 330Nm (Cooper and Aceman), 494Nm (Countryman)
On sale: Now
Price: From Dh158,000 (Cooper), Dh168,000 (Aceman), Dh190,000 (Countryman)
City's slump
L - Juventus, 2-0
D - C Palace, 2-2
W - N Forest, 3-0
L - Liverpool, 2-0
D - Feyenoord, 3-3
L - Tottenham, 4-0
L - Brighton, 2-1
L - Sporting, 4-1
L - Bournemouth, 2-1
L - Tottenham, 2-1
Brief scores
Toss India, chose to bat
India 281-7 in 50 ov (Pandya 83, Dhoni 79; Coulter-Nile 3-44)
Australia 137-9 in 21 ov (Maxwell 39, Warner 25; Chahal 3-30)
India won by 26 runs on Duckworth-Lewis Method
World ranking (at month’s end)
Jan - 257
Feb - 198
Mar - 159
Apr - 161
May - 159
Jun – 162
Currently: 88
Year-end rank since turning pro
2016 - 279
2015 - 185
2014 - 143
2013 - 63
2012 - 384
2011 - 883
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
