The absorption of Credit Suisse by UBS will have immediate effects on the business of the failed Swiss bank in Spain, where it had managed to generate a dynamic against that of the parent company and take advantage of some opportunities resulting from Brexit, according to sources close to the entity itself. The subsidiary was overcoming two years of continuous executive turnover and was taking advantage of its flagship business: wealth management.
The operation announced yesterday now frustrates the plans of a subsidiary that has offices in Madrid, Barcelona and Valencia, and that without ever touching retail banking is dedicated to investment banking, large fortunes and representation of the parent company through Credit Suisse Europe.
Credit Suisse will be sold for just over 3 billion euros to its rival UBS to form a group with 1.5 trillion assets under management. The intervened bank fell 55% yesterday on the stock market, to a value very similar to that of the transaction, while UBS rose 1.2%. This operation and the immense liquidity put by the Swiss National Bank at the service of the entities should serve to contain the crisis.
In Spain, Credit Suisse employs around 400 people and has its main offices on a corner of Calle Ayala in Madrid, in the heart of the Salamanca district. It has deposits in Spain for an amount close to 700 million euros. Its auditor is PwC, which has been validating its accounts without reservations, and the managed assets of fortunes are around 10,000 million.
His plan in Spain went until this weekend to gain positions in private banking. UBS, its rival until yesterday, left the country last year, selling the business to Singular Bank, while another major competitor, French BNP Paribas, transferred its private banking in Spain to Banca March.
Credit Suisse saw an opportunity to attract resources from large Spanish fortunes, as did other international banks such as Rothschild, Safra and Julius Baer, which are reinforcing themselves with signings, the sources explain.
One of the reasons for Credit Suisse's confidence in "discretionary wealth management" in Spain is the change in the sicav regime, collective investment vehicles with reduced taxation. The Government has forced the contributions of all participants to be real, which has caused many sicavs to disappear and family offices to look for banks like Credit Suisse to invest.
In the area of investment banking, the Spanish subsidiary has overcome the shortage of IPOs and the purchase and sale of companies at the end of last year, but it is doomed. According to Bloomberg, UBS is interested in the wealth management unit and not in Credit Suisse's investment banking, which it does not trust.
Credit Suisse Spain, which has been operating in the country since 1998, will encounter an added difficulty. It is difficult for UBS to assume the interesting part of the business, that of great fortunes, since last year, when selling its activity in Spain to Singular Bank, it promised not to return for three years under a non-competition clause. If this clause, which is being interpreted by lawyers, is applied, UBS would be forced to close or sell what remains of Credit Suisse in Spain.
The Credit Suisse subsidiary has also been reorganizing for several years in Spain. After a dance of chairs that began in 2020 in which about twenty bankers left, the subsidiary's CEO, Wenceslao Bunge, resigned from office.
Since then there has not been a visible head, but two managers who report separately to Zurich. Pablo Carrasco directs the great fortunes and Nacho Moreno, the investment banking area. Each for their part, they have been reinforcing the different divisions in the last two years, for which they have signed executives from various banks, including some from UBS.
