On June 12, UBS said it had completed its acquisition of Credit Suisse.。Upon completion of the acquisition, UBS will take another step forward in wealth management and will become an asset-liability expression1.$6 trillion of Swiss giant banks, compared to 8,075 GDP for an entire country in 2022.$6.8 billion。

The deal is the largest banking transaction since the 2008 global financial crisis, and UBS chief executive Sergio Ermotti and chairman Colm Kelleher said it would present challenges but also "many opportunities" for customers, employees, shareholders and Switzerland.。

UBS also announced board nominations for selected Credit Suisse entities.。Credit Suisse's board will include Lukas Gähwiler as chairman and Jeremy Anderson and Christian Gellerstad as vice chairmen, pending regulatory approval.。After the merger, only about a fifth of the management positions came from Credit Suisse.。

The "Joy" and "Worry" of the New Giant

Upon completion of the acquisition, UBS will expand its asset management to $5 trillion, giving UBS a leading position in the global market, otherwise it would take years for UBS to expand to such size and influence。But at the same time, the merger brings an end to Credit Suisse's 167-year history.。Credit Suisse has been plagued by scandals and losses in recent years.。

UBS agreed on March 19 this year to pay 3 billion Swiss francs (about 33.$200 million) of low-priced acquisition of Credit Suisse and assumed losses of up to 5 billion Swiss francs。At the same time, the Swiss authorities launched a bailout to prevent a collapse in customer confidence from pushing Switzerland's second-largest bank to the brink of bankruptcy。The cost of UBS's acquisition of Credit Suisse has fallen again and again under the bailout.。As recently as June 9, UBS reached an agreement with the Swiss government to provide 9 billion francs (about $10 billion) in public support to cover losses from the liquidation of some of Credit Suisse's operations.。

So the market expects UBS to record a huge profit in its August 31 second-quarter results after acquiring Credit Suisse at a fraction of its so-called fair value。

Scale expanded, profits increased, fame soared, it seems that UBS's deal is a solid profit, but there is no free lunch, UBS also faces a variety of challenges。

On the one hand, the completion of the acquisition does not mean that it has been completely "digested."。Elmoti warns of "bumpy" months ahead as UBS continues to "digest" Credit Suisse。UBS presented the new group's financials for the first time last month, highlighting the high risks involved.。While UBS pointed to tens of billions of dollars in potential costs and benefits, it also highlighted the uncertainty surrounding those numbers.。For its part, UBS said it could take three to five years to fully "digest" the process.。

Some analysts have also warned that a takeover of this size inevitably creates uncertainty, which could make it difficult for UBS to retain employees and customers, and that whether the deal will deliver value to shareholders in the long run remains an open question。

Given the size and complexity of Credit Suisse, UBS completed its acquisition of Credit Suisse in less than three months, a speed that can be described as rapid.。And behind UBS's rush to complete the deal is the loss of staff under "uncertainty."。

Credit Suisse's "wave of departures" has barely stopped since the crisis。In April, Credit Suisse disclosed financial data showing that the bank had more than 48,000 full-time employees at the end of the first quarter, a reduction of more than 2,000 full-time employees compared to the end of 2022.。Among them, there are many "veterans" who have been working at Credit Suisse for many years.。For example, Ernesto Cruz, chairman of Securities Capital Markets, who has been at Credit Suisse for nearly 40 years, will join Santander, and Michael Strobaek, chief investment officer at Credit Suisse, who has been at Credit Suisse for ten years, will join LONO.。At the same time also triggered Wells Fargo, Mizuho Financial Group and other global financial institutions, a number of "grabbing war"。Although UBS has also previously said it will cut jobs to reduce costs and take advantage of synergies.。But the massive exodus of executives and key personnel is still causing incalculable losses to Credit Suisse.。The two banks currently have approximately 120,000 employees worldwide.。

On the other hand, Credit Suisse's debt problem。Upon completion of the acquisition, all outstanding debts of Credit Suisse will be fully credited to UBS。All remaining securities under the ticker symbol "CS" will constitute outstanding debt securities issued by Credit Suisse subsidiaries。The independent ratings of these outstanding instruments will remain unchanged, subject to any rating actions by the agencies.。

In addition, UBS will also face questions from the Swiss domestic public。As the Swiss government intervened in the acquisition and launched a bailout plan, there have been a number of voices of doubt in Switzerland that the bailout plan will pass on the Credit Suisse crisis to taxpayers.。In response, both UBS and the Swiss government have promised that the acquisition will pay off for shareholders and will not be a burden on taxpayers.。They say the rescue of Credit Suisse is also necessary to protect Switzerland's position as a financial center, which would be affected if the collapse of Credit Suisse could trigger a broader banking crisis。

At the same time, the public is also concerned that the new bank will be too large, as its balance sheet after the completion of the acquisition is about twice the size of the Swiss economy, which also means that UBS may need to tread carefully to avoid facing the stricter regulatory and capital requirements required by the new size.。

The Swiss Financial Markets Supervisory Authority (FINMA) said the combined bank had the necessary capital and liquidity to quickly reduce risk and successfully complete the integration.。Urban Angehrn, CEO of FINMA, said: "For FINMA, the intensive regulatory phase will certainly continue.。We will monitor the integration process with the utmost attention。"

Fitch Ratings took immediate action to downgrade UBS's long-term issuer default rating (IDR) from "A +" to "A" as UBS completed the acquisition.。Fitch also raised the long-term IDR of Credit Suisse Group from "BBB +" to "A +"。Fitch expects UBS will need to stabilize Credit Suisse's badly damaged revenue-generating capacity, with the merger initially weighing on the enlarged group's operating margins。