As a recent wave of talent migration sweeps through the financial industry, Credit Suisse stands at the eye of the storm. Over 120 of its senior investment bankers have been lured away by competitors, marking an accelerating trend that paints a complex picture of the post-takeover landscape.
Losses mitigate redundancy impact for UBS
UBS, the Swiss banking giant that absorbed its counterpart in June, initially braced for substantial redundancy packages. However, the wave of departures has ironically tempered this burden.
Major players like Deutsche Bank and Jefferies have proven to be the most opportunistic, securing the talents of 40 and 25 former Credit Suisse bankers respectively.
In addition, Santander has brought more than 20 professionals on board. With at least 16 other banks getting in on the action, an influx of junior staff is anticipated to follow suit in the near future.
A higher-than-expected exodus from Credit Suisse has characterized the post-takeover landscape. The reason is straightforward: rivals identified an opportunity to fortify their ranks and seized it.
Financial fallout and human capital shift
Industry analysts are projecting a staggering $10 billion in restructuring costs over the next four years, incurred by UBS due to the $3.5 billion takeover. Amid this turmoil, the outflow of personnel has proven advantageous for UBS in terms of financial relief.
The Swiss giant had prioritized retention in specific sectors, including healthcare and technology, intending to reinforce its US and Asia-Pacific operations.
A significant fraction of those who exited, however, were on the list of employees likely to be cut, hence their departures curbed the potential redundancy payouts.
The reduced activity in Credit Suisse’s investment bank since the takeover has sparked a call for more profound cuts within the business. The company’s staff count has dropped from 52,000 at the close of the previous year to 42,000 due to cost-cutting measures and the migration of staff to competitors.
As the consolidation progresses, an estimated 20,000 roles, primarily within Credit Suisse’s investment bank, are expected to be eliminated from the merged workforce of 115,000 globally.
Predators and prey in the banking ecosystem
Several banking institutions have taken this talent migration in stride, reshaping their teams accordingly. Deutsche Bank, for instance, has onboarded numerous senior bankers, like William Mansfield, the former head of M&A for EMEA at Credit Suisse.
Meanwhile, Santander, under the leadership of chief executive Hector Grisi, has hired over 20 senior investment bankers. The recruited individuals are primarily based in the US, with a few in the UK and Spain, as well as private bankers in Switzerland.
Jefferies, on the other hand, has added more than 25 Credit Suisse bankers to its ranks, securing a series of senior financial specialists and several managers from Credit Suisse’s financial institutions group.
Other players that have capitalized on this workforce shift include Barclays, BNP Paribas, Citi, Macquarie, and Wells Fargo.
As the dust settles on the post-takeover landscape, Credit Suisse’s talent drain offers a fascinating case study on the dynamics of the banking industry.
While the shifting personnel poses challenges for Credit Suisse and UBS, it presents a chance for rival institutions to beef up their teams with experienced talent.
