Switzerland's two wealth giants have maintained a fierce rivalry for decades. Credit Suisse has turned the tables on hometown rival UBS – at least for now. finews.asia parses the details.
Investors have given their verdict on Swiss banking earnings this week: Credit Suisse's shares rose by as much as 5 percent following a healthy first-quarter report, while UBS softened nearly 2 percent after its results on Monday.
Credit Suisse's stock is now worth more than UBS', at least in absolute value – the first time in recent memory. Switzerland's second-largest bank isn't just outmaneuvering UBS with investors: Credit Suisse seems to have traded places with its far larger rival in the heart of lungs of Swiss banking.
1. Wealth Management: Ramping Up
While UBS set its sights on business with the wealthy shortly after emerging from the financial crisis and a $2 billion rogue trader, Credit Suisse under CEO Tidjane Thiam didn't get there until three years ago. The former McKinsey partner cleaned up, raised capital to stabilize the bank, and is embarking on the «year or acceleration», as he calls it.
To be sure, Credit Suisse has come racing out of the gates this year, beating analyst expectations. The profit contribution from private banking, which didn't enjoy much attention under ex-CEO Brady Dougan until very late in his tenure, leaves nothing to be desired. By contrast, UBS disappointed investors in its flagship wealth division, where CEO Sergio Ermotti is merging U.S. with other wealth arms, but shined in investment banking (see Point 3).
2. Home Market: Playing Offense
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