Union Bank of Switzeland, the multinational investment institution, announced the return of its former CEO, Sergio Ermotti, effective 5 April 2023 onward. The change comes as a result of UBS’ plans to takeover Credit Suisse, which was then embroiled in a financial scandal, and a fleet of lawsuits. In a statement issued on 29 March 2023, UBS declared that its current CEO, Ralph Hamers, “has agreed to step down to serve the interests of the new combination, the Swiss financial sector, and the country”. However, he would remain within UBS as an advisor during the period of transition.
Ermotti was the CEO of UBS from 2011 to 2020, and is credited with resurrecting the bank during the 2008 financial crisis. The joint assets of UBS and Credit Suisse are worth almost $1.7 trillion, which is twice the size of Switzerland’s GDP. A veteran captain must be relied on to successfully steer finances of this scale: “[t]his unique experience, together with his deep understanding of the financial services industry in Switzerland and globally, make Sergio Ermotti ideally placed to pursue the integration of Credit Suisse”, said UBS.
In response to the unpredictable merger, Ralph Hamers reaffirmed trust in his predecessor: “[i]ntegrating Credit Suisse is UBS’s single most important task and I am confident that Sergio will successfully guide the bank through this next phase. I am of course sorry to leave UBS, but circumstances have changed in ways that none of us expected’.
After being associated with the Dutch lender, ING, for 25 years, Hamers was criticised for his lack of experience in investment banking and wealth management; two crucial businesses at UBS. Experts say that his ideas took considerable time to execute, and the current circumstance requires UBS to act quickly, keeping in mind the interests of many stakeholders, including the Swiss economy. Adapting to a hopeful outlook, perhaps Sergio Ermotti may provide answers to a time of uncertainty for Credit Suisse shareholders counting their losses.
