UBS Chief Cautions Against Delays In Credit Suisse IT Integration Process
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UBS is striving for a quick and seamless IT incorporation with recently purchased Credit Suisse, transferring only 10% of its former competitor’s 3000 applications.
The company acquired Credit Suisse, its fellow Swiss financial institution, in an urgent rescue in 2023. It anticipates $13 billion in cost savings, with some of these savings expected to come from integrated IT platforms.
UBS Aims To Minimize The Risks Associated With IT Integration
The Chief Executive Officer of UBS, Sergio Ermotti, spoke on this matter at an event. He advised that any setback in the data and IT merging plan could affect these savings.
Customer transition from Credit Suisse to UBS will start this year, and 30% of Credit Suisse applications in 2024, according to the company.
Ermotti stated that by incorporating just 300 apps of Credit Suisse’s collection of 3000 applications, the company is minimizing the risks associated with IT integration
The UBS Chief Executive also recognized that the focus on integration might lead to the bank falling behind competitors in the generative AI field. He said that the team is conscious of the risk.
Ermotti expressed that the company already oversees 100 AI innovative technology projects, half of which are front-facing and half are back-facing, so the team is well prepared.
UBS Shares Surged After The Acquisition
Since the takeover, UBS has witnessed a surge in its shares. Investors are confident about the potential of the merged group due to low acquisition outlays, a substantial rise in assets, and a relatively smooth integration process.
Ermotti chose not to comment on the number of job losses, stating only that it would be a “difficult process.”. The financial institution, with over 111,000 employees, will aim to slash its workforce through attrition, early retirements, and outsourcing wherever possible but layoffs were “unavoidable.”, he stated.
He also promised to oversee UBS “at least” until the incorporation was wrapped up by late 2026 or early 2027.
It suggests that discussions about succession planning were not the main priority on his agenda. However, he plans to introduce internal candidates, similar to his approach when he last departed UBS in 2020.
Ermotti was initially pushed into the position of Chief Executive Officer at UBS in 2011 due to a rogue trader incident. He assisted in restoring the bank – which requested support from the government during the global financial meltdown, before departing nine years later.
In addition to the Integration challenges, UBS also encounters political and regulatory barriers, as Swiss authorities strive to protect the banking infrastructure and improve the monitoring of lenders.
