UBS is looking at options for Credit Suisse’s Swiss bank, including potentially retaining the unit’s investment banking business and selling the rest, two people familiar with the case told Reuters. UBS is studying plans to sell Credit Suisse’s Swiss banking business in an initial public offering (IPO) following its acquisition of the smaller rival, the people said, speaking on condition of anonymity. The considerations are at an early stage because UBS is focusing on finalizing that acquisition and may not make a final decision on a possible IPO for several months, according to another person. UBS and Credit Suisse declined to comment. UBS is on track to complete the state-backed acquisition of Credit Suisse, creating a banking giant with more than $ 5 trillion in invested capital. The future of Credit Suisse’s operations in Switzerland is being closely watched as one of UBS’s key strategic decisions. A combination with UBS would create a dominant position in the Swiss credit market, according to Jefferies analysts. Lawmakers are concerned that the merger could lead to less competition. The Swiss bank of Credit Suisse is one of the four operating units of the lender and is seen as the crown at work. The unit reported pre-tax revenues of 1.5 billion Swiss francs ($1.7 billion) in 2022. The removal of investment banking activities would reverse a step taken just a few months ago. In January, Credit Suisse had moved operations from its broader investment banking division to the Swiss unit, according to Credit Suisse’s 2022 annual report. The two Zurich-based neighbors have been vying with each other for mergers and share sales around the world for decades and UBS, which lags behind Credit Suisse in terms of transactions and Share Sales, wants to strengthen its investment banking business. UBS Chief Executive Sergio Ermotti said Wednesday that his bank is working to finalize the merger with Credit Suisse in late May or early June. Speaking about a possible sale, Ermotti has said that all options for the Swiss business are on the table. On Sunday, the newspaper NZZ am Sonntag reported that UBS is working on a separation of the domestic division of Credit Suisse. The Swiss newspaper quoted a source as saying that UBS had come to the idea of a spin-off, which it had initially ruled out, due to increasing public and political pressure.
