Following the news that Credit Suisse Group AG would be sold to UBS Group AG for $3.3 billion, the beleaguered bank issued two internal memos to staff — one signed by Chairman Axel Lehmann and CEO Ulrich Körner, and a Q&A addressing subjects including job security, pay, bonuses and pensions.
(Bloomberg) — Following the news that Credit Suisse Group AG would be sold to UBS Group AG for $3.3 billion, the beleaguered bank issued two internal memos to staff — one signed by Chairman Axel Lehmann and CEO Ulrich Körner, and a Q&A addressing subjects including job security, pay, bonuses and pensions.
Here are both internal memos, in full:
Memo to staff from Credit Suisse Chairman Axel Lehmann and CEO Ulrich Körner
Dear Colleagues,
We would like to start by sharing our heartfelt thanks to you all for your commitment and dedication to our clients, and to each other, during what has been a very difficult period for our bank.
We know that many of you will have been following the intense media coverage over the past 48 hours on the future of Credit Suisse and appreciate the enormous uncertainty and stress that this has caused. Over the past few days, the management teams of Credit Suisse and UBS, as well as our key stakeholders in Switzerland, have been in talks to set the best course of action for our bank, for our home market, and for our clients, colleagues and shareholders.
In the last few hours, we have agreed that Credit Suisse will merge with UBS, with UBS being the surviving entity in an accelerated process.
The merger transaction remains subject to customary closing conditions and is expected to be consummated by end of 2023.
The Board of Directors and Executive Board will give their support to UBS to ensure a smooth transition and ensure the best outcomes for all our stakeholders, including our people.
We appreciate that you will have many questions, some of which we may not be able to answer today; however, our colleague FAQs aim to provide some initial answers. These will be regularly updated over the coming days. Client Talking Points will also be available on the Intranet for our client-facing colleagues.
Please note that there is no immediate impact on our clients and on our day-to-day working operations. Our branches and global offices will remain open, and all colleagues are expected to and should continue to come to work.
For further information on today’s announcement, we invite you to attend a live ExBconnect call today/tonight. A second ExBconnect call will take place tomorrow at 10:00 CET.
We want to reassure you that we are fully committed to managing this process with transparency and openness, to treating everyone with fairness and respect and to ensure that you are kept up to date as decisions are made to minimize uncertainty and disruption.
Finally, we would again like to express our gratitude to everyone at Credit Suisse for their tremendous efforts over the past few months, commitment and hard work. As a leadership team, we have taken great pride and have been inspired by your unwavering commitment to our bank and to our clients.
Axel Lehmann Ulrich Körner
Colleague Q&A
1. Why is this happening?In recent days there has been increased turmoil in the financial markets and growing concern about risks to financial stability. Despite being a well-capitalized and solvent systemically important global institution, Credit Suisse faced a situation of falling confidence from clients and institutions. In discussions with the Swiss govemment and regulators, the Board of Credit Suisse has decided that the interests of our stakeholders are best served through a merger with UBS.
2. Should staff come into the office on Monday?
Yes. Your role is not immediately impacted. We must all continue to work as normal. It remains critically important that you continue to come to the office or work according to your agreed work pattern.
3. Do I still have a job?
Yes. There is no immediate change to your role.
4. What does this mean for my job security?
Today’s announcement indicates the agreement to merge Credit Suisse and UBS and is subject to necessary approvals. We expect the merger is expected to close by the end of 2023 and until such time we will continue to operate as close as possible to “business as usual,” focused on serving our clients.
As we build the plans to integrate our business, we will communicate regularly to ensure you are aware of progress and any changes that may impact you. We want to reassure you that we are fully committed to managing this process with transparency and openness, to treating everyone with fairness and respect and to ensure that you are kept up to date as decisions are made to minimize uncertainty and disruption.
If there are changes to your role, we will inform you. If redundancies prove necessary, we will communicate in line with prevailing country specific guidelines and practices and with our applicable social partners.
5. When will I know if I still have a job?
We work diligently and at pace throughout the coming period to identify which roles might be impacted. Where necessary, we will communicate with impacted individuals in line with country specific guidelines and policies.
6. If I no longer have a job, will I receive a severance package?
We will aim to continue to provide severance in line with market practice and in discussion with our social partners.
We want to reassure you that we are fully committed to managing this process with transparency and openness, to treating everyone with fairness and respect and to ensure that you are kept up to date as decisions are made to minimize uncertainty and disruption.
Both companies have a history of treating employees who are impacted from a reduction in force with fairness and of providing severance that is consistent with the practices in the markets in which we operate.
7. Will my salary and any bonus still get paid on March 24?
Yes. There are no changes to payroll arrangements.
We will pay salary and bonus, where outstanding, as per the previously communicated schedule. In many countries, the bonus has already been paid out and we do not expect any changes for remaining jurisdictions.
8. What will happen to colleague exit programs / RIFs already underway?
We want to reassure you that we are fully committed to managing this process with transparency and openness, to treating everyone with fairness and respect and to ensure that you are kept up to date as decisions are made to minimize uncertainty and disruption.
9. I understand the need for client facing roles, but what will happen to the corporate functions?
Corporate functions are an integral part of delivering the infrastructure and services for client facing roles, as well as delivering key control functions to ensure risk is managed appropriately. We will work closely with UBS throughout the integration to identify the best approach to continuing to provide this support. We do not anticipate any materials (sic) changes until the transaction has closed.
10. When will the transaction close?
The transaction is subject to regulatory approvals, and we expect it to be completed by the end of 2023. We will keep you informed of the timeline for this and regular updates whenever we can. In the meantime, it is important that we all move forward with our daily business and operations on behalf of our clients.
11. I am a contract worker with Credit Suisse. Will you honour my contract to its end-date?
Until the pending merger receives all of the necessary approvals and is closed, our work should be “business as usual.” If your contract is impacted, you will be informed in line with agreed notice / contract.
12. What happens to my Swiss allowance if I still have a job?
The terms of employment will remain the same until transaction completion and you will remain eligible for all benefits unless communicated otherwise.
13. Have you been in touch with the unions?
We remain in contact with all our social partners and share a commitment to treat all employees fairly and to communicate openly throughout.
14. I am expecting a salary increase as of April 2023, will this still happen?
We will continue to honor our obligations and already communicated salary increases will still be effective from April 2023.
15. Will I receive a bonus for my hard work through 2023?
We will continue to allocate for a 2023 performance bonus for those eligible. We are committed to treat all employees fairly, any bonus plan will be based on both business and individual performance. The Swiss Federal Council retain the right to wholly or partially restrict variable compensation or prescribe adjustment to the Credit Suisse remuneration. Should this be requested and required we will communicate at the earliest opportunity.
16. What happens to my UCA/unvested stock?
We are committed to treating all employees fairly. We do not anticipate making any adjustments to UCA and deferred award programs for employees already paid and committed to employees up to the acquisition close date. We will ensure you are keep (sic) informed should there be any changes post close.
17. I am leaving Credit Suisse; do I need to pay back my UCA (“Upfront Cash Award”)?
The Upfront Cash Awards that have been granted continue as per the rules of the award. In the event of resignation, the claw back conditions continue to apply.
18. What happens to my Credit Suisse vested stock?
Fully vested stock is not impacted by this event and will be made available (if not already) per existing process. Any share awards exercised or vested before close shall be settled in the form of share consideration structured so that the Awards beneficiaries shall receive for each Credit Suisse shares the merger consideration otherwise receivable. After close, all deferred share awards shall be (upon exercise or vesting as applicable) settled in the form of the new company shares instead of Credit Suisse shares.
19. Will I receive the Transformation Award that was recently communicated to me?
We anticipate the cash component of the transformation award will continue to be paid in line with the terms of the award. We will confirm any impact on the equity component at the earliest opportunity once the transaction has closed.
The Swiss Federal Council retain the right to wholly or partially restrict variable compensation or prescribe adjustment to the Credit Suisse remuneration. Should this be requested and required we will communicate at the earliest opportunity.
20. What will be the impact on my deferred awards if the buyer values shareholder equity at little or zero?
This will be subject to the agreement we close and will be communication (sic) at the earliest.
21. What happens with my pension contributions? Is my pension safe?
The terms of employment will remain the same until transaction completion and your pensions contributions will continues (sic) to be made in line with your election as long as your employment continues.
22. What will happen to CS pensioners?
The Pension funds are secured under the Pensionskasse and regulations. The funds are managed independently from the company and will not be affected.
23. What happens to my Pillar 3a pension funds (“Dritte Saule”)?
The Credit Suisse Investment Foundation (CSA) and the Credit Suisse Investment Foundation 2nd Pillar (CSA 2) are institutions that are used for employee benefits insurance and intended for the collective investment and management of pension capital. These investment foundations are legally distinct from the company.
24. I have outstanding corporate expenses – will the firm still repay me?
Yes. The firm will continue to pay expenses that are in line with our policies in the usual way.
25. What happens with my healthcare?
We do not anticipate making any changes to our benefits programs until the transaction closes and you will continue to have access to these benefits whilst employed.
26. What happens to my loan/leasing/credit (in relation to employee rates)?
We do not anticipate making any adjustments to compensation or benefit programs for employees between now and the date the acquisition closes.
27. Are my savings safe?
One of the main purposes of merging with UBS is to ensure we can continue to safeguard the savings and assets of our clients (including members of staff). We are committed to this.
28. Will we be closing our branches or ATMs?
No. Our branches remain open for our clients and customers as normal. Our aim is to continue operating a full service for our clients and consumers through the period of any transaction and beyond and this will be a priority for all partners and regulators in the period ahead.
29. How many people will lose their jobs? In Switzerland? Internationally?
Today’s announcement indicates our intent to combine the two organizations, over the coming months we will be seeking necessary approvals from various stakeholders. Following completion of transaction, details of the business plan and the going forward strategy will be shared including the impact, if any, to people in Switzerland and internationally.
30. I have just been RiF’ed – what does this mean for me?
This announcement has no impact to you as we will continue to honor the terms of any separations, including social plan agreements
31. I want to resign — do the notice periods change?
We are sorry to learn of your decision. The announcement has no impact on existing terms and conditions of employment until further communicated and notice periods remain consistent with your contract of employment.
32. I would like to volunteer for an exit — is that possible?
The terms of your employment will remain the same until the transaction has completed and we are not currently operating any special voluntary exit program. You have a legal right to voluntarily resign with notice and terms consistent with your contract of employment.
33. Can I have early retirement?
The terms of employment will remain the same until transaction completion and you will remain eligible for all benefits unless communicated otherwise.
34. What happens to my holiday entitlement?
The terms of employment will remain the same until transaction completion and you will remain eligible for all benefits unless communicated otherwise, you should continue to plan and take your holiday and agree this with your line manager in the usual way,
35. How/where can I get a job reference letter?
We will continue to provide employment reference in line with local practices. In Switzerland, please request a reference letter via the People Hub / Manager.
36. Will I need to reapply for my job?
Today’s announcement indicates our intent to combine the two organizations and over the coming months we will be seeking necessary approvals from various stakeholders. We expect the transaction to be completed by later in 2023 and until such time we will continue to operate per existing processes and guidelines. Communication, if any, related to re-application will be shared with relevant individuals in line with country/regional specific guidelines and policies.
37. What about my ongoing education (Weiterbildung) external and internal?
The terms of employment, this also includes an external education, agreement, will remain the same until transaction completion and you will remain eligible for all benefits unless communicated otherwise.
38. Mobility Employees:I have a special arrangement where Credit Suisse pays for my children’s school fees – will the arrangement be honored?
I am living in a Credit Suisse corporate apartment – will be able to stay per the terms of the agreement?
Until the pending merger receives all the necessary approvals and is closed, we continue to operate our daily business. We do not anticipate making any adjustments to compensation or benefit programs for employees between now and the date the acquisition closes, other than those that might occur in the normal course of business for both companies. Therefore, there is no change of your terms of employment.
39. My son/daughter is an apprentice in Switzerland. What happens to him/her?
Today’s announcement indicates our intent to combine the two organizations and over the coming months, we will be seeking necessary approvals from various stakeholders. We expect the transaction to be completed during 2023 and until such time we will continue to operate under our previously defined strategy. Communication, if any, related to apprentices will be shared with relevant individuals in line with country/ regional specific guidelines and policies.
40. I am on sick leave? What happens to me?
We are sorry that you are on sick leave. There are no changes to your terms of employment and the health insurance firm will continue to honor its obligations. Please reach out to People Hub or your Manager in case of additional queries. We wish you all the best of recovery.
41. Who do we go to for further information and with any queries at this time?
Please refer to the Infokit and additional support materials available on the intranet in the first instance.There will be a hotline available for colleagues to call with any additional queries and the contact details will be provided by 12:00 CET, Monday March 20.
42. How will I be kept informed?
The Executive Board will host an all-colleague ExBconnect call at 10:00 CET Monday March 20, during which there will be an opportunity to ask questions. ExB members will each host a town hall with their teams from Monday March 20. The intranet will be regularly updated with further information.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.