The stereotype of the noble industrialist battling the evil banks has long been a fixture in Swiss public discourse. With UBS’s acquisition of Credit Suisse, the bank has definitely grown beyond the cozy mediocrity that defines parts of the country's business culture. Fairness, it seems, has been lost in the process, writes Florian Schwab, publishing director at finews.com.
Clichés simplify life. In classic Cold War-era Hollywood films, the villain is often a megalomaniac Soviet psychopath. And in medieval Alemannic legends, the devil frequently appears disguised as a goat.
Since at least the downfall of Swissair, public debate about Switzerland's financial sector has followed a stereotype as well: Any industrialist who attacks the banks can be assured of microphones, front-page coverage, and editorial columns in the press.
Since the Swissair Grounding
The cold-hearted banker dismissing the heroes of industry: this prototype has dogged the banks since the days of former UBS president Marcel Ospel (1950–2020) and the collapse of Swissair in 2001. Seven years later, at the height of the financial crisis, Swatch patriarch Nicolas G. Hayek (1928–2010) proclaimed at an important yearly industry gathering, «The mentality on stock markets today has only one goal: money, money, and more money, as quickly and as much as possible, at any cost.»
Today, his son Nick Hayek echoes the same sentiment. «The stock market only cares about short-term profit,» the current Swatch chief lamented during the company’s 2023 earnings presentation, which unfortunately fell short of expectations.
Headlines on Demand
He also praised Credit Suisse: «Credit Suisse is an important institution, not only for the world but also for Switzerland», as it supported Swiss industry.
For over a year now, the theme of «good industrialists, bad bankers» has been omnipresent. Without much exaggeration, it seems every disgruntled UBS corporate client from the industrial sector is able to secure their headline in the «Blick» tabloid or airtime on the SRF public broadcasting channels.
Textbook Public Relations
Last Sunday, Swissmem, the trade association for the Swiss machinery industry, turned up the heat of public opinion even further. In a textbook PR move, its director, Martin Hirzel, fed «NZZ am Sonntag» with a home-brewed survey (article in German, paywalled) showing that 23 percent of industrial companies reported worse conditions since UBS took over Credit Suisse.
Rapid-Fire and Drumroll
The accompanying headline read as if per instruction: «The big bank has lost the trust of its most important domestic partner: the industrial sector.»
And the rapid-fire conclusions in the supporting opinion piece (article in German) felt like a drumroll on a theater stage: «The fact that the CEO leaves the annual industry meeting immediately after his speech doesn’t inspire confidence. The constant badmouthing of CS is becoming tiresome. In Switzerland, the bank didn’t get everything wrong. UBS still has to prove it can do better.»
Even at NZZ
It seems the national pastime of UBS-bashing has even reached Falkenstrasse, where the pro-business publishing house «Neue Zürcher Zeitung» is headquartered.
Since Switzerland is a free country, perhaps it’s permissible to raise three small points of inquiry:
- Where were the industrial barons and their media allies during those critical hours and days when Switzerland’s second-largest bank was politically brokered into the arms of UBS? Could it be that, at the time, there was a lack of strategic foresight and determination on the part of our esteemed (and wealthy) watchmakers, auto suppliers, and niche-worldmarket-leaders?
- Is it completely unthinkable that Credit Suisse, even in its Swiss corporate banking, was operating with a potentially unhealthy risk appetite that any new owner would naturally have to correct in their own interest?
- Wouldn’t it make more sense, especially for the watch industry, to seek closer cooperation with the financial industry? After all, they both represent major export segments that, at least theoretically, stand for similar values: absolute reliability, innovation, precision, Swissness. Swiss private bankers are fantastic global ambassadors for watch brands like Rolex, Patek Philippe, Hublot, Audemars Piguet, Blancpain, Breguet, and Omega – and vice versa.
It’s clear that UBS is currently navigating a precarious balancing act, walking the razor’s edge between margin and risk optimization as expected by shareholders, and the expectations of the public. So far, the bank’s communication has fared poorly, as finews.com detailed extensively on Monday.
Tied Hands
On the other hand, UBS, now Switzerland’s last truly major international bank, is fighting a battle for public opinion with its hands tied. Any carpenter or plumber can cry «foul» in the media, while the bank, bound by client confidentiality and other ethical considerations of the profession, is naturally forbidden from responding in kind.
What’s needed, then, is a bit of fairness for UBS!
