UBS is preparing an overhaul of its investment bank as the Swiss lender seeks to galvanise earnings and cut costs after a drop off in performance over the past few quarters.
This content was published on
3 minutes
Stephen Morris, Financial Times
As part of the revamp, due to be announced at a townhall on Thursday, executives are discussing hundreds of job cuts at the investment bank, especially within the higher ranks, as duplicate roles are cut after sweeping divisional mergers, according to people familiar with the matter.
External Content
The bank’s main equities division will be combined with its smaller foreign exchange, rates and credit trading (FRC) operations to create a single securities and trading unit, said three people with knowledge of the changes. Jason Barron, head of equities, will run the unit alongside George Athanasopoulos, head of FRC.
On the advisory side of the business, Ros Stephenson and Javier Oficialdegui will be named global co-heads of investment banking, overseeing the bank’s M&A and capital markets activities around the world, they said. The division will be rebranded from corporate client solutions (CCS) and will introduce a global rather than regional structure as in the past.
Additionally, all debt and equity capital markets functions will be combined into one global unit for the first time and led by Brendan Connolly, formerly the head of leveraged debt capital markets.
Performance decline
Along with much of the industry, UBS’s investment bank has gone through a rough patch of late amid geopolitical tensions, low client activity levels and regulatory changes. These challenges have been exacerbated by the loss of high-profile dealmaker Andrea Orcel, who ran the unit between 2012 until his departure last September to become CEO of Santander, a move which eventually fell through.
The investment bank made a surprise $47m loss in the fourth quarter of last year followed by two quarters of sharp declines in year-on-year profits.
While better than many rivals, especially on the advisory side, it still prompted questions from investors and analysts about whether the bank had the right strategy. UBS’s stock has fallen 32 per cent in the past 12 months.
Mr Orcel’s successors, M&A banker Piero Novelli and trader Rob Karofsky, now almost a year into their roles, hope the changes will simplify the bank’s structure and drive earnings, particularly on the trading side, the people said.
Chief executive Sergio Ermotti’s overhaul of the investment bank closely follows changes made at UBS’s primary wealth management division, which last week recruited former Credit Suisse executive Iqbal Khan to address concerns about succession planning and lacklustre performance.
Mr Khan will take over from Martin Blessing on October 1 as co-head of wealth management alongside Tom Naratil. Mr Blessing is leaving UBS.
Copyright The Financial Times Limited 2019
Popular Stories
More
Multinational companies
Azeri fossil-fuel cash cow brings controversy to Switzerland
Is artificial intelligence an advantage or a disadvantage for workers?
What is your experience with AI at work? Have you already used it? Has it helped you work better? Or has it caused you more stress, more work or caused you to lose your job? Tell us about your experiences!
Swiss price watchdog slams excessive prices for generic medicines
This content was published on
The cheapest generic medicines available in Switzerland are more than twice as expensive as in other countries, according to a study by the Swiss price watchdog.
Nature should not figure in net zero calculations: academic study
This content was published on
The natural removal of CO2 from the atmosphere by forests or oceans should not be included in the net-zero balance of climate protection measures, argue researchers.
This content was published on
None of the 15 major Swiss retail banks is meeting international climate and biodiversity targets, according to a ranking by WWF Switzerland.
This content was published on
Nestlé's new CEO Laurent Freixe, has presented plans for the future of the world's largest food company, after his first few weeks in office.
Swiss foreign minister calls on Moscow to end Ukraine war
This content was published on
It's high time Moscow ended its war against Ukraine, Swiss foreign minister Ignazio Cassis tells the UN Security Council.
This content was published on
The only alternative to the UN Palestinian agency’s work in Gaza is to allow Israel to run services there, Philippe Lazzarini, UNRWA Commissioner-General, told reporters in Geneva on Monday.
Study reveals food culture differences between Switzerland and neighbours
This content was published on
Three-quarters of Swiss people consider eating to be a pleasurable, social activity, a new survey reveals. Healthy eating, however, plays a much less important role, it found.
This content was published on
The request was submitted to the Swiss tax administration at the end of last year but has only just been made public. On Tuesday the Swiss authorities published the request in the Federal GazetteExternal link to give affected people the chance to appeal against their data being handed over. Such group requests from foreign tax…
Swiss financial sector shines in international survey
This content was published on
The reputation and quality of Swiss banks were rated as “good” to “very good” by most respondents in the international poll of 12,767 people. The ethics and responsibility of the Swiss banking sector are also well regarded. “Contrary to what we sometimes fear in Switzerland, our financial centre enjoys a very good reputation abroad,” said ambassador Nicolas Bideau, head of Swiss Presence, the…
You can find an overview of ongoing debates with our journalists here . Please join us!
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.