Sergio Ermotti, chief govt officer of UBS Group
Stefan Wermuth | Bloomberg | Getty Pictures
UBS CEO Sergio Ermotti on Wednesday stated folks with issues in regards to the dimension of the financial institution’s steadiness sheet are getting “indoctrinated” by lecturers and will “do their homework.”
UBS accomplished its takeover of Credit score Suisse in June 2023 after an emergency rescue deal was brokered by Swiss authorities to forestall the then 167-year-old establishment’s collapse and shield the Swiss financial system.
Ermotti was introduced again to the helm of UBS to supervise the complicated integration of Credit score Suisse’s enterprise — a mission up to now deemed a convincing success by the market. The financial institution’s share value has recovered from beneath 17 Swiss francs ($19.69) per share within the aftermath of the deal to over 25 Swiss francs as of Wednesday morning.
Nevertheless, the brand new entity’s mixed steadiness sheet is estimated to be round twice the dimensions of your complete GDP of Switzerland, elevating issues in regards to the focus of danger within the Swiss financial system.
Talking to CNBC on the sidelines of the World Financial Discussion board in Davos, Switzerland, on Wednesday, Ermotti stated he understood why some parts of the Swiss inhabitants nonetheless have reservations, as they’re being “indoctrinated virtually each day by numerous lecturers” and focusing solely on the dimensions of the financial institution’s steadiness sheet versus the nationwide GDP.
“In the event you have a look at risk-weighted belongings as a proportion of GDP or as a proportion of our steadiness sheet, you’ll uncover that the brand new UBS is de facto very low danger, very centered enterprise mannequin. The chance we’ve is in Swiss mortgages, in Lombard loans, in stuff that could be very low danger,” he stated.
Ermotti contended that the “new UBS” incorporating its fallen rival to create a globally aggressive, low-risk financial institution is a “reflection of Switzerland.”
“Switzerland is a small nation that punches properly above its weight in lots of sectors — in meals, in pharma, in innovation — and having a robust financial institution that may compete, not solely in Europe, however globally, is a part of our financial system,” he stated.
He additionally argued that the deal with the danger to the Swiss taxpayer fails to take note of the size of the financial institution’s personal tax contributions, urging the general public to “have a look at the dangers but additionally the advantages.”
“In that sense, our position is to assist the people who find themselves not satisfied, that wish to take heed to arguments, to tell them in order that they arrive to an opinion that’s knowledgeable, hopefully the suitable one. I respect folks having different opinions, however I do anticipate them to do their homework,” he added.
