UBS faces investors after shotgun Credit Suisse merger

NEW YORK: UBS will seek to reassure shareholders on Wednesday that its unexpected takeover of rival Credit Suisse in the biggest bank rescue since the great financial crash can work.

Last month, Swiss authorities announced that UBS would buy Credit Suisse in a shotgun merger to stem further banking turmoil after the smaller lender had come to the brink of collapse. After a run on deposits, the Swiss government had turned to UBS, which agreed to buy Credit Suisse for 3 billion Swiss francs ($3.3 billion), while the Alpine state put up more than 200 billion francs of support and guarantees.

The move angered not only shareholders but many in Switzerland. A survey by political research firm gfs.bern found a majority of Swiss did not support the deal. Shareholders of Switzerland's largest bank will have the chance to air their views on Wednesday, although they may be wary about rocking a boat that had been on a steady course.

For 2022, UBS reported a net profit of $7.6 billion and strong inflows in wealth management, the company's flagship division. Now, the bank is looking at how to navigate the mammoth task of integrating Credit Suisse, the success of which Switzerland depends on, without undermining its strengths.

It has already taken the first steps. Last week UBS announced it had rehired Sergio Ermotti as chief executive to steer the massive takeover - a surprise move to take advantage of the Swiss banker's experience rebuilding the bank after the global financial crisis. Wednesday marks Ermotti's first official day back in the job, but he is not expected to attend.

Instead, outgoing Chief Executive Ralph Hamers, who has led the bank for less than three years will take the stage, alongside Chairman Colm Kelleher. The bank's annual general meeting comes a day after executives at Credit Suisse faced their own shareholders and Chairman Axel Lehmann apologised for leading the bank to the verge of bankruptcy.