SWITZERLAND’S flagship lenders are gearing up for large-scale job cuts to clamp down on costs, with some estimates for redundancies running into the thousands.
UBS and Credit Suisse have both suffered from currency fluctuations and a drop in revenues that has hit many investment banks due to low trading volumes.
And both banks hired heavily over 2010 in anticipation of a bounce back in markets this year, which failed to materialise. UBS blamed “personnel” for a costs increase in its latest results.
The news follows City A.M.’s report at the beginning of the month that UBS has implemented an unofficial headcount freeze in its London fixed income, commodities and currencies team, while Credit Suisse is mid-way through a jobs consultation to lay off as many as 300 workers in the UK.
Swiss newspaper Tages-Anzeiger claimed that the cuts would amount to a drastic 5,000 headcount chop at UBS and 1,000 at Credit Suisse.
Kumaran Surenthirathas of investment banking recruiter Eximius says: “Many global banks are scaling back after suffering the effects of falling trading volumes on the financial markets.”
He added: “The Swiss banks face the added burden of high cost bases as the Swiss franc soars to new record highs against the dollar and the euro, as well as requirements to hold capital in excess of international standards.”