Credit Suisse traders ponder voluntary redundancy as UBS deal nears
The deal is nearly done. This time next week, Credit Suisse should be legally merged with UBS. And when that happens, Credit Suisse insiders hope may finally be liberated to go on their way.
While plenty of Credit Suisse salespeople and traders have left voluntarily for rivals (including credit salesman Marco Pasinetti who today revealed that he too is leaving for Milan), some have been glued in place by Credit Suisse's cash bonus clawbacks which are activated when people leave. Even though many of last year's markets bonuses were excruciatingly small, headhunters say they've been sufficient to discourage some people from exiting.
Once the deal is finalized, however, UBS may find it cheaper to get rid of its unwanted Credit Suisse people by negating the clawbacks and nudging them to leave of their own accords. For some, at least, this is the hope. Credit Suisse people who haven't had the tap from UBS have reportedly been trying this tack already, but have been thwarted by the fact that neither Credit Suisse nor UBS have been in a position to fulfill their wishes. When the deal is finalized, that will all change.
However, even if the merger is sealed next week, UBS is unlikely to jettison Credit Suisse staff immediately. Although senior Credit Suisse staff have already received retention bonuses from UBS, and although 100 Asian bankers are reportedly being kept on at the combined bank, UBS has made it clear that it needs more time to understand its acquisition.
"It will take at least two months for UBS to work out who they want," says one senior insider. "And even that would be fast. You have to start with senior management and then go all the way down the hierarchy." It will be much easier to make retention decisions in the wealth management unit, he predicts: Iqbal Khan, who runs the business for UBS was hired from Credit Suisse and therefore knows the Credit Suisse business and its people well, plus it's easier to measure performance objectively than in the markets business, where risk taking isn't always transparent.
This might be why Credit Suisse markets professionals who haven't had UBS offers say they've also had no indication when they might be let go. One said he's received targets until Q3 and that UBS appears to be in no hurry to make a decision.
Another Credit Suisse markets insider said he's received a few offers from other employers but hasn't acted on them yet and is still at Credit Suisse, which has given him no indication when he will be asked to leave. Former CS colleagues who've moved received generous offers that were "up 50%" he added; he's holding out for something similar.
Few people in Credit Suisse's European markets team expect to still be around in 2024, though. Although UBS CEO Sergio Ermotti said last week that senior jobs are likely to be more evenly divided between CS and UBS people than initially expected, UBS has also made it clear that it has little appetite for much of Credit Suisse's fixed income business.
"If you're wondering who will be around in the next one or two months, I'd say most," says one senior insider. "But if you're asking how much of the European bank at Credit Suisse will be here in the next six to 12 months, I would say next to nothing."
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