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A financial institution worker affiliation mentioned it was deeply shocked by the potential penalties of the UBS-Credit score Suisse deal.
Switzerland awoke to a brand new period on Monday after UBS swept up Credit score Suisse in a government-brokered rescue that dented the nation’s long-held satisfaction in its banking experience.
A financial institution worker affiliation mentioned it was deeply shocked by the potential penalties of the deal to save the 167-year-old Credit Suisse after buyer and market confidence within the lender evaporated.
In a package deal orchestrated by Swiss regulators on Sunday, UBS pays 3 billion Swiss francs ($3.24bn) for Credit score Suisse and assume as much as $5.4bn in losses.
With their headquarters only a few minutes’ stroll away from one another, not removed from Lake Zurich within the centre of the town with snow-capped mountains on the horizon, the 2 lenders have been pillars of worldwide finance for many years.
The banks, two of essentially the most systemically related in international finance, maintain mixed property of as much as 140 % of the Swiss gross home product (GDP), in line with the central financial institution, in a rustic closely depending on finance for its economic system.
The Swiss Financial institution Workers Affiliation, in a press release to Reuters information company, demanded that UBS hold job cuts to an “absolute minimal”.
“The roles of very many staff are at stake,” it mentioned, including that it was in contact with the administration.
The assertion underscores the sense of unease in Switzerland, with its status as a world monetary centre on the road.
Swiss media had been additionally shocked by the developments.
“A zombie is gone however a monster is born,” learn the title of a commentary within the Neue Zuercher Zeitung, usually seen because the voice of the institution.
“A number of months in the past, no person would have thought that Credit score Suisse would fail. Nonetheless it isn’t an accident,” the newspaper wrote within the piece accusing the financial institution of vanity and satisfaction.
“The Swiss financial institution had a inventory market worth of CHF 100 billion in 2007, of which CHF 7 billion had been left final Friday,” it mentioned.
“There has thus been a large destruction of worth, by the hands of managers who’ve carelessly underestimated dangers and helpless board members who’ve too usually failed to regulate issues.”
The Tages-Anzeiger newspaper described the affair as a “historic scandal”.
Nonetheless, UBS Chief Government Ralph Hamers – who will lead the brand new mixed entity as CEO – was assured his financial institution was as much as the problem of creating the takeover successful.
“The takeover implies that we’re bringing again stability and safety for CS purchasers,” Hamers mentioned. “But in addition that we’re upholding the status of the Swiss monetary centre.”
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