The designated boss of the Swiss bank UBS, Sergio Ermotti, has countered concerns regarding the future size of the institute following the emergency takeover of Credit Suisse. “The question of excessive size does not arise,” said Ermotti in an interview with the Italian business newspaper “Il Sole 24 Ore” published on Saturday. Even with the combination of UBS and Credit Suisse, it has not yet reached the top in terms of size according to international standards.
Ermotti emphasized that UBS is well positioned with its business areas. “And our greater critical mass will certainly give us another advantage on a global scale.” Ermotti, most recently President of the reinsurance company Swiss Re, will take over the helm at UBS once more on April 5. The Italian-speaking Swiss was head of the bank from 2011 to 2020 and is now returning to UBS in the middle of the mega takeover of Credit Suisse. With the risky merger of the two globally systemically important institutions with a total of around 120,000 employees, the trained investment banker is faced with a Herculean task.
Credit Suisse was on the brink of insolvency in mid-March as a result of a crisis of confidence. Around two weeks ago, the Swiss government and regulatory authorities urged UBS to swallow the traditional company practically overnight. The government resorted to emergency law for the takeover. In Switzerland, the reactions were mostly negative. Politicians and the general public fear that competition with only one major bank will suffer and that Switzerland would hardly be able to save the new giant UBS in an emergency. According to a recent survey, economists were also mostly skeptical regarding the emergency takeover.
