Philipp Hildebrand, BlackRock Inc.’s vice chairman, expects Credit Suisse Group AG to pursue an overhaul of the firm much like its bigger Swiss rival undertook in 2012.
Hildebrand praised UBS Group AG Chairman Axel Weber for the reorganization that saw Switzerland’s biggest bank cut thousands of jobs as it scaled back the securities unit to focus on wealth management. The firm also boosted capital.
“I assume that we will see something similar with Credit Suisse in the next few months -- the whole question of business models has changed massively,” Hildebrand, a former president of the Swiss National Bank, said on a panel with Weber in Bern on Monday. BlackRock is UBS’s second-biggest shareholder, Bloomberg data show.
Credit Suisse hired Tidjane Thiam, Prudential Plc’s former chief executive officer, to replace Brady Dougan as investors sought greater clarity on the bank’s strategy amid a share slump. Shareholders are betting Thiam, who takes over this week, will downsize the firm more aggressively in part to address a capital gap, which according to some analysts could be of as much as 13 billion Swiss francs ($14 billion).
For the third consecutive year, the SNB this month urged banks to raise their leverage ratios, which refers to the amount of capital they must hold against their assets and is a measure of their ability to withstand adverse scenarios including an escalation of the euro-area debt crisis. Switzerland introduced some the world’s strictest capital requirements in 2011 after the government came to UBS’s rescue during the 2008 financial crisis.
“The entire issue of the finance sector has at least conceptually been solved,” said Hildebrand.