RBI lets Credit Suisse retain license

According to a report by ET NOW on Wednesday, the Reserve Bank of India has granted permission to UBS-acquired Credit Suisse to retain its banking license in India. UBS has enlisted the expertise of Tom Wipf from Morgan Stanley to assist in leading the integration of Credit Suisse.

UBS is currently managing the integration process following its emergency takeover of Credit Suisse Group AG’s business. Reports suggest that UBS plans to reduce Credit Suisse’s workforce by over 50%.

Internal memos circulated by UBS also revealed changes to the executive board of Credit Suisse AG after the official completion of the takeover, effectively ending Credit Suisse’s independent existence of 167 years. This acquisition positions UBS to gain significant profits in the tens of billions of dollars, while also incurring potential mark-downs on Credit Suisse assets and associated legal and regulatory costs.

The deal’s closure follows UBS’s successful negotiations with the Swiss government, securing a 9 billion Swiss franc ($10 billion) guarantee against potential losses on Credit Suisse assets.

Regarding the Swiss domestic business acquired from Credit Suisse, UBS has yet to decide its future. Initially, UBS intended to fully integrate the local unit, but later reconsidered its approach. UBS CEO Ermotti stated that all options are being considered, including a sale or spinoff. A decision on this matter is expected to be made in the third quarter of this year.

UBS has committed to developing detailed integration plans for each business unit and establishing a defined strategy for winding down specific activities in a non-core unit by the fourth quarter.