Last month, UBS agreed to acquire Credit Suisse for $3.23 billion in stock and will be responsible for up to $5.4 billion in losses.
The global head of wealth management at UBS, Iqbal Khan, reportedly met with Credit Suisse executives, including Puneet Matta, the local lender’s wealth head, in Singapore, informing them that the wealth business in India is likely to be retained.
UBS left India’s private wealth market by 2014, but the increase in the number of billionaires in India has fuelled its interest in returning. The merger is expected to result in significant portions of Credit Suisse’s investment bank being shut down. Credit Suisse has a total of around 7,000 employees in India, with just over 40 in wealth management.
The UBS-Credit Suisse agreement, which was finalised last month, includes a liquidity assistance of $108 billion for both banks from the Swiss central bank. The federal government is providing a loss guarantee of up to 9 billion Swiss francs to enable UBS to acquire Credit Suisse, which will only be triggered if losses are actually incurred on this portfolio.
UBS will assume the first 5 billion francs, and the federal government will take the next 9 billion francs in case of losses, with UBS assuming any further losses, according to the government.
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