RBI Okays UBS-acuired Credit Suisse To Keep Its Indian Banking License: Report

The Reserve Bank of India has granted permission for UBS-acquired Credit Suisse to maintain its banking license under its own name in India, according to a leading media house. UBS has enlisted the help of Tom Wipf from Morgan Stanley to assist in overseeing the integration of Credit Suisse Group AG's operations following the bank's emergency takeover. UBS intends to reduce Credit Suisse's workforce by more than 50 per cent. 

After the Swiss bank officially completed the acquisition of its former rival, it circulated an internal memo announcing changes to the executive board of Credit Suisse AG. This deal marks the end of Credit Suisse's 167-year independent existence and allows UBS to proceed with the intricate process of integrating the former rival, which is expected to involve significant job cuts. 

The emergency rescue agreement brokered by the Swiss government in March, which led to the acquisition, positions UBS to gain windfall profits amounting to tens of billions of dollars. However, it also exposes UBS to potential markdowns on Credit Suisse assets, as well as legal and regulatory expenses. 

UBS reached a final agreement with the Swiss government on a 9 billion Swiss franc (USD 10 billion) guarantee to cover potential losses on Credit Suisse assets. However, UBS has yet to make a decision regarding the future of the Swiss domestic business acquired from Credit Suisse, a segment of the bank that has consistently generated profits and played a significant role in financing Swiss companies and households. Initially, UBS had planned to fully integrate this local unit, but it later reconsidered its approach. CEO Ermotti stated that all options were being considered, including a sale or spinoff. A decision on this matter is expected in the third quarter of this year. 

UBS has also announced its intention to develop detailed integration plans for each business unit, as well as a defined strategy for winding down specific activities in a non-core unit by the fourth quarter.