UBS Group AG doesn’t plan to make the large-scale job cuts seen at global peers as the business of making investments for wealthy clients continues to see robust growth, Chief Executive Officer Ralph Hamers said.
(Bloomberg) — UBS Group AG doesn’t plan to make the large-scale job cuts seen at global peers as the business of making investments for wealthy clients continues to see robust growth, Chief Executive Officer Ralph Hamers said.
“We are not in retrenchment mode,” Hamers said in an interview with Bloomberg Television at the World Economic Forum in Davos on Tuesday. “We are hiring for what we call critical jobs. In Asia Pacific, in the Middle East, we are hiring absolutely because we have the momentum,” he said.
With Europe and the US flirting with recession, and after a year of weak dealmaking, firms including Goldman Sachs Group Inc. and BNY Mellon Corp. are cutting thousands of jobs as they focus on trimming costs. Hamers’ optimism underscores the divergence in outlook for global growth, with the Middle East in particular enjoying an energy-related cash windfall.
Read More: Goldman to Cut About 3,200 Jobs This Week After Cost Review
“We are really bucking the trend when it comes to asset management and wealth management,” Hamers said. Bank of America Corp. has also said that it plans to increase the number of advisers in wealth management after the business set records.
Hamers’ cautious optimism was echoed by Christiana Riley, head of Deutsche Bank AG’s business in the Americas. She signaled that the bank is “selectively, opportunistically looking at what the market may present,” in terms of hiring in a separate interview in Davos.
Optimism is also rebounding in Asia as China abruptly called an end to the its strict pursuit of Covid Zero and partially reopened its borders to foreign travelers. Globally, M&A deals shrank 33% last year, with Asian dealmaking sliding 22%, according to data compiled by Bloomberg.
UBS expects its Asian wealth business to grow this year, Asia Pacific President Edmund Koh told Bloomberg last week. He too vowed to add talent to his division.
The Asian wealth unit has benefited from outflows at rival Credit Suisse Group AG as hundreds of wealthy clients have been seeking to shift their funds, Bloomberg has reported.
UBS’s total headcount crested 72,000 in the third quarter last year, up by 3,347 since the end of 2019, according to filings. The bank’s shares are up 8% in the past 12 months.
Read More: BofA to Expand Its Fleet of Wealth Advisers as Demand Increases
Last year the bank backed away from acquiring robo-adviser Wealthfront, a deal that was meant to widen its reach to the lower rungs of the wealthy there. Instead, UBS has said it would focus on its traditional very high net worth customer base. The reversal of the Wealthfront deal and recalibration of the US strategy were a blow to Hamers, who staked the early part of his term as CEO on effecting a digital-first wealth-management
The Swiss lender’s US strategy is in flux after longtime Americas chief Tom Naratil retired, leaving Iqbal Khan to take on global leadership of the wealth management business.
Hamers said Tuesday that his strategy has been clear since he became CEO, with the US forming one part of a “barbell” of growth areas, the other being Asia.
Read More: UBS Backtracks on CEO’s Plan to Reach Wider Swath of US Wealthy
“We will focus on Asia as that’s where entrepreneurial growth is, including China,” he said. “And we will focus on the US, because that’s where entrepreneurial wealth growth is as well. There is a two poles strategy in terms of growth support.”
In the US, Hamers said the bank is committed to increasing the scale of its business there.
“We need to develop our banking product offering as well on both loan and deposit sides,” he said. “And we need to invest in digital in order to help scale and for clients to access the information themselves and we’re launching some of these products as we speak.”
(Adds comment from Deutsche Bank Americas head on hiring in fifth paragraph)
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