Bankers at Credit Suisse Quickly Throw in The Towel
Bankers at Credit Suisse (NYSE:CS) are quickly throwing in the towel as hundreds of resignations hit the distressed bank.
Swiss newspaper Blick reported earlier on Wednesday that each day around 150 people worldwide were resigning from Credit Suisse while one of the two people said they saw about 200 resignations a week.
Credit Suisse bankers, worried about their future are seeking safer employment at competitors, one person said.
People familiar with the matter declined to be named because they are not authorized to speak publicly, per Reuters.
UBS (NYSE:UBS) agreed on March 19 to take over its smaller Swiss rival as part of a rescue arranged by the Swiss authorities after a bout of market turmoil brought the struggling lender to the brink of collapse.
Credit Suisse said in April that the bank’s “employee attrition has been higher over the last year,” and that it had just over 48,000 full-time employees at the end of the first quarter and reported 50,480 full-time staff at the end of 2022.
UBS management has also said it would set a “very high bar” when deciding whether to retain any of Credit Suisse’s investment banking staff.
Similarly, about 1,000 First Republic (OTCMKTS:FRCB) employees have lost their job across all of First Republic’s businesses after the JPMorgan takeover.
UBS has said it plans to wind down Credit Suisse’s investment bank, which employs about 17,000 staff, and the Swiss state has pledged 9 billion Swiss franc in guarantees to cover potential losses from the operation.
No day passes without receiving a goodbye email from someone across the bank, one of the two people said.
At the investment bank, calls are often unanswered, he added.
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10,000 People Will Lose Their Banking Job
During the merge of UBS and Credit Suisse sources cautioned that “the talks to resolve the crisis of confidence in Credit Suisse are encountering significant obstacles, and 10,000 jobs may have to be cut” if the two banks combine.
The merged bank will employ 120,000 worldwide, although UBS has already said it will be cutting jobs to reduce costs, per Reuters.
Credit Suisse clients began withdrawing billions of dollars during the first quarter of the year.
In November of 2022, the bank had warned investors in a 6-K filing of potential losses due to naked short covering which has many retail investors speculating the nature of the markets.
Berkshire Hathaway’s Warren Buffett has held discussions with senior Biden administration officials about the banking crisis, a source told Reuters during the time of the merge.
All parties declined to comment on the banking situation.
This is the latest development in the UBS and Credit Suisse merge, but various banks today are laying off staff.
The banking crisis is happening globally with reports of banks such as JPMorgan and Captial One now freezing customer bank accounts.
Read: New Study Shows Nearly 190 Banks on Verge of Collapsing
US Banks Are Now Cutting 3,000 Roles Globally
US banks are now cutting more than 3,000 roles globally in the latest spree.
The US bank’s latest job cuts will hit 3,000 roles globally across most of its key divisions, as it embarks on its second round of redundancies within the space of six months, says FinancialNews London.
Morgan Stanely (NYSE:MS) recently cut around 70 dealmakers in Europe; the latest round of layoffs to hit the Wall Street bank this week.
Managing directors within its investment banking and global capital markets teams in Europe, the Middle East and Africa were informed of job cut decision earlier this week on Monday according to people familiar with the matter.
At the senior level, approximately 10 managing director dealmakers were cut in the region, the people added.
In January, Morgan Stanley’s rival Goldman Sachs laid off more than 3,000 employees and cut executive salaries.
Reuters reported on Friday that JPMorgan (NYSE:JPM) was cutting about 500 employees this week across its various departments, according to a person familiar with the situation who asked not to be identified discussing personnel matters.
The layoffs will affect employees across the bank’s main businesses — consumer, commercial banking, asset and wealth management — as well as technology and operations, the source said.
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