UBS Reshapes Post-CS Strategy With India Expansion and Swiss Job Cuts

UBS is moving through a pivotal stage of absorbing Credit Suisse, a process that is reshaping the lender’s organizational setup and cost framework. While thousands of positions disappear in Switzerland, the group is aggressively scaling its capacity in India, underscoring a tension between cost discipline and preserving a local base.

• Expansion: Up to 3,000 new roles in India planned.
• Reduction: About 3,000 jobs to go in Switzerland.
• Focus: A new technology hub dedicated to AI and IT.
• Background: Integration of Credit Suisse.

In Hyderabad, a city in southern India, UBS is launching a new Global Capability Center. The bank confirmed this week that in the coming months it intends to create between 2,000 and 3,000 additional positions there, effectively doubling UBS’s presence in the region. The emphasis is on building out technological capabilities, with Matthias Schacke, head of the India operation, stressing growth in areas such as artificial intelligence and operational services.

At the same time, the group is tightening its Swiss footprint. Roughly 3,000 roles are being removed from its home market. Management attributes the reductions to redundancies introduced by the Credit Suisse acquisition completed in March 2023. CEO Sergio Ermotti said the bulk of the cuts would occur through natural turnover and early retirements to soften social impact.

Should investors sell immediately? Or is it worth buying UBS?

Denials, concerns, and a broader trend

UBS maintains that there is no official link between the India expansion and the Swiss workforce reduction. While the company says there is no direct connection, the coincidence in job counts has fuelled scrutiny among observers.

The Schweizerische Bankpersonalvereinigung, the Swiss Bank Employees Association, has voiced concern about the development. Vice President Natalia Ferrara warned that regulatory conditions must not render Switzerland unattractive as a business location. Still, moving back-office and IT activities to lower-cost Global Capability Centers reflects a wider industry pattern, one that many Wall Street firms are pursuing.

Synergies, stock reaction, and the pathway forward

For investors, the crucial data points are the financials behind the restructure. UBS’s share price has weakened over the last 30 trading days and currently trades below the consensus targets set by analysts. The restructuring aims to simplify the post-acquisition architecture and deliver the previously lifted synergy target. Management has raised the goal to $13.5 billion in synergies, underscoring the importance of these changes for restoring market confidence and achieving the efficiency milestones laid out for the integration.