Credit Suisse bankers will still get bonuses despite UBS takeover
Bankers at imploding Credit Suisse are still going to get their bonuses despite it being swallowed up by rival UBS, it emerged on Monday.
The fallen Swiss banking giant has told staff they will still get bonuses on Friday as promised, according to an internal memo.
They will also be in line to get the pay-outs during 2023 as the merger takes time to go through.
Credit Suisse Group shares opened down 62.09 per cent on Monday morning after the rescue merger by UBS.
In a package orchestrated by Swiss regulators on Sunday, UBS will pay three billion Swiss francs (£2.65 billion) for Credit Suisse and assume up £4.43 billion in losses.
Swiss authorities pushed for UBS to take over its smaller rival after a plan for Credit Suisse to borrow up to 50 billion francs (£44.3 billion) failed to reassure investors and the bank’s customers.
But in a Q&A memo to staff, Credit Suisse chiefs stressed that they would still get promised bonuses.
The questions included:
Q: Will my salary and any bonus still get paid on March 24?
A: Yes. There are no changes to payroll arrangements. We will pay salary and bonus, where outstanding, as per the previously communicated schedule. In many countries, the bonus has already been paid out and we do not expect any changes for remaining jurisdictions.
Q: I am expecting a salary increase as of April 2023, will this still happen?
A: We will continue to honor our obligations and already communicated salary increases will still be effective from April 2023.
Q: Will I receive a bonus for my hard work through 2023?
A: We will continue to allocate for a 2023 performance bonus for those eligible. We are committed to treat all employees fairly, any bonus plan will be based on both business and individual performance
Q: Should staff come into the office on Monday?
A: Your role is not immediately impacted. We must all continue to work as normal. It remains critically important that you continue to come to the office or work according to your agreed work pattern.
Q: Do I still have a job?
A: There is no immediate change to your role.
Q: When will I know if I still have a job?
A: We work diligently and at pace throughout the coming period to identify which roles might be impacted. Where necessary, we will communicate with impacted individuals in line with country specific guidelines and policies.
Q: If I no longer have a job, will I receive a severance package?
A: We will aim to continue to provide severance in line with market practice and in discussion with our social partners. We want to reassure you that we are fully committed to managing this process with transparency and openness, to treating everyone with fairness and respect and to ensure that you are kept up to date as decisions are made to minimize uncertainty and disruption. Both companies have a history of treating employees who are impacted from a reduction in force with fairness and of providing severance that is consistent with the practices in the markets in which we operate.
Q: How many people will lose their jobs? In Switzerland? Internationally?
A: Today’s announcement indicates our intent to combine the two organizations, over the coming months we will be seeking necessary approvals from various stakeholders. Following completion of transaction, details of the business plan and the going forward strategy will be shared including the impact, if any, to people in Switzerland and internationally.
Q: I have a special arrangement where Credit Suisse pays for my children’s school fees - will the arrangement be honored? I am living in a Credit Suisse corporate apartment - will be able to stay per the terms of the agreement?
A: Until the pending merger receives all the necessary approvals and is closed, we continue to operate our daily business. We do not anticipate making any adjustments to compensation or benefit programs for employees between now and the date the acquisition closes, other than those that might occur in the normal course of business for both companies.