UBS has said it is going to bring back former CEO Sergio Ermotti to guide the Swiss banking giant after its $3.2 billion takeover of ailing rival Credit Suisse.
Ermotti, 62, whose rule will start on April 5, will replace outgoing chief executive Ralph Hamers, who will remain on the bank in an advisory role to assist with the transition.
Ermotti, who was the bank’s chief executive from 2011 to 2020, is credited with helping UBS recuperate from the large losses suffered through the 2008 financial crisis.
UBS said Hamers, who has been CEO since November 2020, “agreed to step right down to serve the interests of a latest combination, the Swiss financial sector and the country.”
The bank said it made the move “in light of latest challenges and priorities” following the federal government’s bailout to Credit Suisse.
Hamers, a Dutch national, said he regretted leaving UBS, “but circumstances have modified in ways none of us expected.”
Hailing from the southern, mostly Italian-speaking region of Switzerland, Ticino, Ermoti admitted that “coming back to deal with this example is a challenge” but felt “a way of duty call” to return.
“The duty is urgent and difficult,” Ermotti said in an announcement.
Swiss Executive Will to take control of a newly formed asset manager of roughly USD 1.7 trillion, which is roughly 30% of your complete Swiss banking sector.
Swiss authorities have urged UBS to take over a smaller rival after the central bank’s plan to have Credit Suisse borrow as much as $54 billion did not reassure investors and customers.
The Swiss executive took extraordinary measures to bypass shareholder approval.
Prior to UBS’s takeover of Credit Suisse, JPMorgan analysts wrote that “we see an excessive amount of concentration risk and market share control”.
Swiss authorities planned the merger in hopes of stopping a wider banking crisis.
Contagion fears were fueled by the collapse of US lenders Silicon Valley Bank and Signature Bank of Latest York.
JPMorgan Chase and the country’s 10 largest lenders have teamed up to supply a $30 billion capital injection to assist struggling San Francisco-based First Republic Bank.
With postal wires