Coinspeaker
UBS Appoints Credit Suisse CEO Ulrich Koerner to Its Board of Directors
Swiss multinational investment banking firm UBS Group AG (SWX: UBSG) has announced that Ulrich Koerner, the CEO of Credit Suisse, will be joining the executive board of the new joint entity. The update comes a few weeks after an emergency purchase of Credit Suisse by UBS was facilitated by regulators.
UBS confirmed the announcement according to a news release, emphasizing that Koerner will be in charge of maintaining Credit Suisse’s operational continuity and client focus while assisting the integration process, using his experience in both businesses.
Additionally, UBS stated that the legal completion of its acquisition of Credit Suisse is expected to occur in the coming weeks. Following the completion of the acquisition, the two banks will operate as a consolidated banking group.
This means that the two banks will almost certainly be integrated to some extent. Meanwhile, UBS had given a statement that the Credit Suisse brand will continue to function separately for the “foreseeable future” as UBS integrates the business in a “phased approach”.
Whatever conclusion the bank makes, it will be interesting to see how the merged business operates and how it affects the banking industry and financial markets in general. Notably, Koerner will be working together with Sergio Ermotti as the new CEO to oversee the Credit Suisse takeover, while UBS veteran Todd Tuckner will become Chief Financial Officer (CFO) for the group.
According to the information provided, the combined firm will have five business divisions, seven functions, and four regions in addition to Credit Suisse, each represented by a board member reporting to Ermotti.
Is the UBS Acquisition the Best Deal for Credit Suisse?
The acquisition of Credit Suisse by the bigger bank has been viewed using different lenses by industry observers. Markedly, an earlier report revealed that shares of the Swiss banking behemoths UBS and Credit Suisse plummeted following the latter’s takeover. According to the details, the stock of Credit Suisse dropped by 60%, while shares of UBS dropped by 10%.
Furthermore, the European banking index was down approximately 2% around the same time. Also, lenders such as Deutsche Bank AG (ETR: DBK), Barclays PLC (LSE: BARC), and ING Group (AMS: INGA) traded lower by more than 1.36% at the time of writing.
While commenting on the takeover, Colm Kelleher, Chairman of UBS stated that the deal is part of a cut-price deal to stem a larger banking contagion, as “attractive” for UBS shareholders. However, the UBS Chairman went on to say that such an appeal does not always pose the same proposition for the acquired bank.
Meanwhile, UBS stated in a release that the collaborative endeavor should generate more than $5 trillion in total invested assets. Furthermore, the banking behemoth stated that the merging of banking resources would result in sustainable value opportunities that will end up being profitable for all.
UBS Appoints Credit Suisse CEO Ulrich Koerner to Its Board of Directors
