Exclusive-UBS names South Korea, India, others as ‘slow’ to nod Credit Suisse deal – document

(C) Reuters. The logos of Swiss bank Credit Suisse and UBS are seen in Geneva, Switzerland, June 7, 2023. REUTERS/Denis Balibouse/File photo

By Engen Tham and Selena Li

SHANGHAI/HONG KONG (Reuters) -UBS Group AG has identified at least four countries including South Korea and India as “slow” in granting regulatory approvals which it needs to complete its takeover of Credit Suisse, according to an internal document reviewed by Reuters.

UBS has also identified Ireland and Saudi Arabia as “slow jurisdictions” in granting licences, according to the document which was dated Sept. 6 and circulated to global staff, the content of which has not previously been reported.

The document, prepared after a global review to assess the timeline of regulatory approvals necessary for the integration to complete, said non-cooperative regulators could put transactions such as the Swiss bank merger at risk.

The uncertainties in securing regulatory nods could also lead to winding down businesses and asset sales, when UBS faces “difficult jurisdictions or regulators”, the bank said in the document.

Credit Suisse, which was Switzerland’s second-biggest bank, suffered years of scandals and losses before it had to be rescued in March this year in a state-engineered takeover by former rival UBS.

UBS completed its takeover of Credit Suisse in June. It still needs approvals from regulators in markets where both the banks operate for the legal completion of the deal that resulted in the first rescue of a global bank since the 2008 financial crisis.

UBS and Credit Suisse did not respond to Reuters request for comment. Spokespeople for central banks in South Korea, India, Ireland, and Saudi Arabia also did not immediately respond to Reuters request for comment.

The first-ever merger of two global systemically important banks has created both opportunities and risks for UBS, which has been working on integrating Credit Suisse’s businesses with itself in numerous markets.

UBS last month said it expected the merger to be completed in 2024. The bank’s internal document showed the process could be finished as soon as May next year.

In the review document, UBS said “a single non-cooperative regulator can jeopardize the timeline of the parent bank merger and other transactions”, impacting other related integration deals.

In South Korea, it may take up to 18 to 22 months to obtain new licences, the bank said, while in Ireland the process could take up to two years, and up to 12 months in Saudi Arabia, the document showed.

The regulator in India could take a minimum of six months to approve the setting up of a new branch, it added.