UBS’s integration of clients and data from former rival Credit Suisse into its own platforms is “on track” after a successful test, its information technology chief told Reuters.
Sergio Ermotti, CEO of UBS, has previously indicated that the integration of information technology is one of the biggest risks facing UBS as it begins the second, more delicate phase of the merger with its fallen rival, having acquired it in an emergency rescue operation last year.
Mr Ermotti said in May that any delay in IT integration would impact the savings the Swiss banking giant has committed to making.
UBS completed a test last month involving the migration of hundreds of Credit Suisse clients from Hong Kong and Singapore, said Mike Dargan, UBS Group Chief Operations and Technology Officer.
“We tested a few hundred customers from Hong Kong and Singapore, of varying complexities, in September,” he said. “It went very well. The whole room was applauding. There were tears.
The bank will begin migrating registered customers to Luxembourg and Hong Kong in the coming weeks, then to Singapore a little later, and other countries will follow later, in 2024 and next year. UBS plans to migrate 1.3 million clients in total.
“This is the largest data migration in an M&A transaction in the financial services industry, if not the largest overall,” Mr. Dargan said during the ‘an interview given to Reuters in Zurich. “Overall, we are on the right track in terms of technology integration.
Investors are pleased with the way the largest bank takeover since the global financial crisis is unfolding. UBS shares have gained nearly 56% in value since the Credit Suisse takeover was announced in March 2023.
But IT integration carries risks due to its complexity, the scale of the customer base and data transfers.
For Credit Suisse, UBS is migrating 110 petabytes of data, each petabyte equivalent to 500 billion pages of printed text, or enough to fill 20 million large filing cabinets.
Credit Suisse had around 3,000 applications, 100,000 servers and 16 data centers.
So far, UBS has taken down about 560 applications, 13 petabytes of data and 40,000 servers, Dargan said.
“We’re pretty much on schedule on applications and ahead of schedule on servers,” he said.
Mr Dargan, who is responsible for around 40,000 employees, said the bank would reduce the number of external contractors UBS uses in technology and operations, allowing it to retain the majority of permanent employees of Credit Suisse and to increase the proportion of internal staff in the areas of technology and operations to 85%, which is currently 60%.
UBS employed around 110,000 people at mid-year.
According to media reports, the total workforce could fall to around 90,000 people once the integration is completed in 2026.
