Moving ahead with its plan to restructure wealth management business, UBS Group AG (UBS - Free Report) is mulling to axe about 500 jobs in the unit. Also, the company is planning to split its private banking business in Europe, the Middle East and Africa. The news was reported by Bloomberg.
The moves come under the leadership of Iqbal Khan, who joined the Swiss bank in October 2019. Khan seeks to revamp the company’s ultra-high net worth business led by Joseph Stadler.
Khan plans to remove up to three layers of management in the division with a view to speed up the decision making process. The expected cuts form about 2% of the unit's workforce.
The Swiss bank is also taking steps to streamline the process for loans originated in the wealth management unit.
Khan has made several other changes recently in a bid to boost UBS’ performance. Last month, he along with Tom Naratil, the co-head of UBS’ wealth management unit, planned to wind down the bank’s dedicated unit for the ultra-wealthy clients and establish a new one for rich wealth-management clients, who also require investment banking services.
Notably, the ultra-rich clients, who do not require investment banking services, are likely to be shifted into the existing regional divisions.
The company has long remained focused on building capital levels, expanding globally and executing restructuring initiatives. Though net interest income remains under pressure, thanks to falling interest rates, its strategic alliances to boost customer base and efforts to tap opportunistic areas bode well.
UBS’ shares have gained 8.9% over the past six months against the industry’s decline of 2%.
Currently, UBS carries a Zacks Rank #2 (Buy).
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