1 00:00:02,520 --> 00:00:07,000 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. 2 00:00:07,800 --> 00:00:10,399 Speaker 2: Let's get out to Davos, where Bloomberg Surveillance anchor John 3 00:00:10,440 --> 00:00:13,680 Speaker 2: Ferrer is standing by. John take it away. Hey, guys, 4 00:00:13,920 --> 00:00:16,880 Speaker 2: live from Davos, Switzerland at the World Economic Forum, standing 5 00:00:16,920 --> 00:00:19,079 Speaker 2: by the King of Swiss Banking. He might not like 6 00:00:19,120 --> 00:00:22,840 Speaker 2: that introduction. It's Sergio ad Marti, the ubsc EO surg I. 7 00:00:22,880 --> 00:00:25,319 Speaker 2: Good to see you. Hey, thanks for braving the colde 8 00:00:25,360 --> 00:00:27,840 Speaker 2: I appreciate it. Before we get into the bank, we're 9 00:00:27,840 --> 00:00:30,000 Speaker 2: going to ease into this and start with financial markets. 10 00:00:30,240 --> 00:00:33,120 Speaker 2: What a start to the trading week. Stateside equities open up, 11 00:00:33,240 --> 00:00:37,440 Speaker 2: gap lower, bonyard, tire dollar week. We've seen this movie before. 12 00:00:37,520 --> 00:00:40,080 Speaker 2: Last April got over it pretty quickly. We've thrown a 13 00:00:40,080 --> 00:00:42,120 Speaker 2: lot of this market in the last twelve months. It 14 00:00:42,159 --> 00:00:44,599 Speaker 2: hasn't stuck. Is there something different about the way we're 15 00:00:44,600 --> 00:00:45,880 Speaker 2: set up for twenty twenty six. 16 00:00:47,040 --> 00:00:50,360 Speaker 1: Well, I would say that it's probably the accumulation of 17 00:00:50,440 --> 00:00:53,440 Speaker 1: issues that are now out there and not resolved that 18 00:00:54,000 --> 00:00:57,120 Speaker 1: is becoming a little bit troubling in my point of view. 19 00:00:57,160 --> 00:00:59,960 Speaker 1: So I think that this is the only major change, 20 00:01:00,360 --> 00:01:04,240 Speaker 1: but we have to stay tuned for more volatility. Going 21 00:01:04,280 --> 00:01:08,840 Speaker 1: forward and predictability and rapid changes. So I think that 22 00:01:09,880 --> 00:01:13,440 Speaker 1: staying diversified in financial markets nowadays is pretty important. 23 00:01:13,600 --> 00:01:16,280 Speaker 2: Let's get to what that word means, diversify. It feels 24 00:01:16,280 --> 00:01:18,800 Speaker 2: like that's a diplomatic way of saying South America sometimes, 25 00:01:18,840 --> 00:01:20,200 Speaker 2: and I'm not going to put words in your mouth. 26 00:01:20,280 --> 00:01:22,759 Speaker 2: I'll tell you what others are saying. Pinco is talking 27 00:01:22,760 --> 00:01:26,600 Speaker 2: about a multi year period of diversification away from US assets. 28 00:01:26,800 --> 00:01:29,760 Speaker 2: We've seen from others moving out of US treasuries. There 29 00:01:29,760 --> 00:01:32,160 Speaker 2: was a headline earlier on this morning about a very 30 00:01:32,160 --> 00:01:34,959 Speaker 2: small Danish pension fund and they've got their own issues 31 00:01:35,000 --> 00:01:37,440 Speaker 2: in Denmark right now. Given their relationship with America, what 32 00:01:37,480 --> 00:01:38,959 Speaker 2: are you seeing development. 33 00:01:38,480 --> 00:01:42,240 Speaker 1: Well, Diversifying away from America is impossible. I think that 34 00:01:43,160 --> 00:01:47,120 Speaker 1: in any major asset allocation, one could probably think about 35 00:01:47,120 --> 00:01:51,360 Speaker 1: having an overweight or underweight, But diversifying away from the 36 00:01:51,440 --> 00:01:55,960 Speaker 1: US and also from the dollar is a quite dangerous beat. 37 00:01:56,440 --> 00:02:00,760 Speaker 1: You know, things can change rapidly, and this is the 38 00:02:00,800 --> 00:02:03,600 Speaker 1: strongest economy in the world, the one was the highest 39 00:02:03,800 --> 00:02:06,200 Speaker 1: level of innovation right now is a little bit bumpy, 40 00:02:06,520 --> 00:02:09,919 Speaker 1: but I would say that I wouldn't really bet against 41 00:02:10,160 --> 00:02:10,959 Speaker 1: the US. 42 00:02:10,720 --> 00:02:13,440 Speaker 2: There seems to be a difference between how the politicians 43 00:02:13,440 --> 00:02:16,080 Speaker 2: and the policymakers talk about America right now the backdrop 44 00:02:16,080 --> 00:02:19,200 Speaker 2: for international relations, and how a business person thinks of America, 45 00:02:19,280 --> 00:02:21,959 Speaker 2: the economy and the opportunity. I've mentioned this now a 46 00:02:22,040 --> 00:02:25,519 Speaker 2: number of times already today about the survey the PwC 47 00:02:25,680 --> 00:02:28,399 Speaker 2: put out. They survey four and a half thousand CEOs 48 00:02:28,639 --> 00:02:32,240 Speaker 2: and the top destination for capital for investment America, and 49 00:02:32,280 --> 00:02:35,440 Speaker 2: it was up on last year. As a bank boss 50 00:02:35,520 --> 00:02:38,720 Speaker 2: right now, a CEO who's thinking about expanding around the world, 51 00:02:39,120 --> 00:02:40,760 Speaker 2: why is us still top of mind for you? 52 00:02:41,360 --> 00:02:44,720 Speaker 1: Well, because from our centerraint of view, we see two 53 00:02:44,720 --> 00:02:49,480 Speaker 1: big levers. First of all, wealth creation GDP growth innovations, 54 00:02:49,600 --> 00:02:53,600 Speaker 1: and also more indiosyncratic to UBS is that we see 55 00:02:53,600 --> 00:02:58,840 Speaker 1: potential for us to become more present, increase our market 56 00:02:58,840 --> 00:03:02,519 Speaker 1: share one place. On the other end, we are also 57 00:03:02,639 --> 00:03:05,680 Speaker 1: very big in Asia. I mean we manage one trillion 58 00:03:05,720 --> 00:03:08,120 Speaker 1: of assets there. We are growing very fast, the economy 59 00:03:08,160 --> 00:03:12,240 Speaker 1: is growing. Half of the population in the world is 60 00:03:12,320 --> 00:03:15,440 Speaker 1: living there and is creating new wealth. But you know, 61 00:03:15,639 --> 00:03:18,839 Speaker 1: in the America, in the US, by the way, last year, 62 00:03:20,440 --> 00:03:24,000 Speaker 1: the US created twenty five millions of new millionaires, so 63 00:03:24,040 --> 00:03:29,240 Speaker 1: basically one thousand millionaires a day. So it's a place 64 00:03:29,280 --> 00:03:32,280 Speaker 1: for a financial institution, a wealth manager like UBS is 65 00:03:32,280 --> 00:03:32,840 Speaker 1: a place to be. 66 00:03:33,040 --> 00:03:34,480 Speaker 2: Let's talk about that. Is that something you want to 67 00:03:34,520 --> 00:03:36,280 Speaker 2: do organically or through an acquisition. 68 00:03:36,920 --> 00:03:41,400 Speaker 1: I think that we have enough to do organically. By 69 00:03:41,960 --> 00:03:45,200 Speaker 1: doing better what we can do, we are enhancing our 70 00:03:45,240 --> 00:03:51,960 Speaker 1: product capabilities. We just got a national charter application being 71 00:03:52,000 --> 00:03:57,560 Speaker 1: approved by the OCC. We are expanding our interaction between 72 00:03:58,000 --> 00:04:00,960 Speaker 1: the investment bank and our wealth management people. So I 73 00:04:00,960 --> 00:04:04,680 Speaker 1: think that more things we can do to get better 74 00:04:04,720 --> 00:04:05,280 Speaker 1: and stronger. 75 00:04:05,360 --> 00:04:07,160 Speaker 2: It sounds like you're on the front foot at the 76 00:04:07,160 --> 00:04:09,120 Speaker 2: same time as the boucer in behind me. I'm reminded 77 00:04:09,120 --> 00:04:11,560 Speaker 2: of where we are Switzerland and the issues on the 78 00:04:11,560 --> 00:04:14,920 Speaker 2: horizon potentially for the bank, and that's capital requirements. That 79 00:04:14,920 --> 00:04:17,200 Speaker 2: feels like a cloud that's hanging over this bank right now. 80 00:04:17,200 --> 00:04:18,800 Speaker 2: How quickly do you think we can resolve it? 81 00:04:20,600 --> 00:04:24,320 Speaker 1: Not quickly. I think it's a political process. Most likely 82 00:04:24,360 --> 00:04:26,880 Speaker 1: we're going to find out the direction of travel that 83 00:04:27,120 --> 00:04:30,520 Speaker 1: you know in the middle of the second quarter, and 84 00:04:30,560 --> 00:04:33,680 Speaker 1: then it's still a political process. But you're right that 85 00:04:33,839 --> 00:04:38,680 Speaker 1: this is something that has been quite distracting for us. 86 00:04:38,720 --> 00:04:41,760 Speaker 1: Although we have been quite successful in managing the integration 87 00:04:41,800 --> 00:04:45,599 Speaker 1: of Predy Swiss is almost completed. We are almost you know, 88 00:04:46,360 --> 00:04:49,960 Speaker 1: three months ago and then the vast majority of the 89 00:04:50,040 --> 00:04:53,000 Speaker 1: job is done. So but we look forward for our 90 00:04:53,000 --> 00:04:54,800 Speaker 1: resolution also, I'm sure you do. 91 00:04:54,920 --> 00:04:57,480 Speaker 2: From the strategic standpoint, How is it holding you back? 92 00:04:57,520 --> 00:04:59,480 Speaker 2: How is it distracting you? What are you prevented from 93 00:04:59,520 --> 00:05:01,200 Speaker 2: doing that you've would like to do right. 94 00:05:01,120 --> 00:05:03,440 Speaker 1: Now at this point in time, To be fair, nothing, 95 00:05:03,480 --> 00:05:07,599 Speaker 1: because you know, executing the integration is the top priority. 96 00:05:07,760 --> 00:05:11,320 Speaker 1: We cannot be complacent. Although ninety eighty five percent is done, 97 00:05:12,160 --> 00:05:16,160 Speaker 1: the last fifteen percent is as important. We still need 98 00:05:16,200 --> 00:05:20,640 Speaker 1: to take out three billion of costs and finalize the 99 00:05:20,680 --> 00:05:24,800 Speaker 1: restructuring and then we can We are prepared for growth, 100 00:05:25,000 --> 00:05:27,400 Speaker 1: and that's the reason why we are investing top line 101 00:05:27,400 --> 00:05:31,840 Speaker 1: but also in efficiencies AI and how we can become 102 00:05:32,279 --> 00:05:33,200 Speaker 1: better and stronger. 103 00:05:33,320 --> 00:05:35,799 Speaker 2: Where did the cost come out? You satisfied with the 104 00:05:35,880 --> 00:05:37,680 Speaker 2: size of the workforce. There's more need to be done 105 00:05:37,680 --> 00:05:38,280 Speaker 2: on that side of. 106 00:05:38,200 --> 00:05:41,560 Speaker 1: Well, there is still unfortunately that's the more. You know, 107 00:05:41,800 --> 00:05:43,840 Speaker 1: A big chunk of the savings are going to come 108 00:05:43,880 --> 00:05:50,520 Speaker 1: by disconnecting all the IT systems, data centers. But also 109 00:05:50,600 --> 00:05:53,040 Speaker 1: there is a you know, also a painful still part 110 00:05:53,520 --> 00:05:56,400 Speaker 1: on the account. But it's within what we always announced. 111 00:05:56,640 --> 00:06:00,960 Speaker 1: So you know, I think the direction of travel is said. 112 00:06:01,040 --> 00:06:03,040 Speaker 2: This is the top of the to do list for you, 113 00:06:03,200 --> 00:06:05,640 Speaker 2: and then someone else is going to step in eventually. 114 00:06:05,880 --> 00:06:08,360 Speaker 2: You've offered your thought about where that someone might come from, 115 00:06:08,600 --> 00:06:11,000 Speaker 2: that you'd like to see them come from internally, from 116 00:06:11,040 --> 00:06:14,160 Speaker 2: within the bank, you open to someone coming from the outside. 117 00:06:14,480 --> 00:06:16,280 Speaker 1: Well, we always need to be open. I think that 118 00:06:16,320 --> 00:06:19,040 Speaker 1: the board is not you know, my job is to 119 00:06:19,680 --> 00:06:23,960 Speaker 1: is to prepare and to present to the board as 120 00:06:24,040 --> 00:06:27,960 Speaker 1: many candidate possible for internally and the role of the 121 00:06:27,960 --> 00:06:31,200 Speaker 1: board is to also evaluate external candidates and find the 122 00:06:31,240 --> 00:06:34,159 Speaker 1: best solution for the future. But I would say the 123 00:06:34,160 --> 00:06:36,600 Speaker 1: bank is very strong, My team is very strong, and 124 00:06:37,320 --> 00:06:41,040 Speaker 1: I do believe that, you know, an evolution is what 125 00:06:41,080 --> 00:06:43,640 Speaker 1: we need. Is probably not a revolution, but you know, 126 00:06:43,800 --> 00:06:45,000 Speaker 1: it all depends. 127 00:06:44,800 --> 00:06:46,720 Speaker 2: What's the timeline for that process. Now, can you give 128 00:06:46,760 --> 00:06:49,120 Speaker 2: us an idea. At what point do you present your 129 00:06:49,200 --> 00:06:51,080 Speaker 2: ideas about who might succeed you? 130 00:06:51,440 --> 00:06:54,720 Speaker 1: Well, we always every year I present ideas and you 131 00:06:54,720 --> 00:06:59,280 Speaker 1: know a succession. Succession is not a process that you do. 132 00:06:59,680 --> 00:07:05,080 Speaker 1: You know, only a few months or years before somebody leaves. 133 00:07:05,120 --> 00:07:09,600 Speaker 1: A succession is somebody that we manage every year, and 134 00:07:09,720 --> 00:07:11,560 Speaker 1: from my Iceland point of view, we need to be 135 00:07:11,800 --> 00:07:14,920 Speaker 1: just prepared to have the best person for that moment. 136 00:07:15,080 --> 00:07:17,600 Speaker 2: When that person is selected, there is another seat that 137 00:07:17,680 --> 00:07:20,760 Speaker 2: might open, and it's the chairperson's seat. And I just 138 00:07:20,800 --> 00:07:23,400 Speaker 2: wonder when you step aside a CEO, as the chapter 139 00:07:23,440 --> 00:07:25,240 Speaker 2: truly closed for you and the bank. 140 00:07:25,960 --> 00:07:28,080 Speaker 1: Well, look, you know, right now, I'm very focused on 141 00:07:28,440 --> 00:07:31,320 Speaker 1: finishing my job. Honestly, I think this is still very 142 00:07:31,320 --> 00:07:36,600 Speaker 1: intense activity and then it's going to be you know, 143 00:07:36,640 --> 00:07:37,360 Speaker 1: I need to reflect. 144 00:07:37,440 --> 00:07:40,120 Speaker 2: You realize people watching this won't really believe that, well, 145 00:07:40,600 --> 00:07:43,480 Speaker 2: you are a human being. You were thinking about the 146 00:07:43,520 --> 00:07:45,040 Speaker 2: future and what comes next. 147 00:07:45,160 --> 00:07:47,920 Speaker 1: But people watching there are not expecting me to respond. 148 00:07:48,640 --> 00:07:50,720 Speaker 2: That is true as well, particularly this gentleman right here 149 00:07:51,400 --> 00:07:53,880 Speaker 2: who wants that response from you. Just a final question 150 00:07:53,960 --> 00:07:55,880 Speaker 2: from me. I believe you first took the job as 151 00:07:55,920 --> 00:07:58,640 Speaker 2: CEO back in twenty eleven. As you look back on things, 152 00:07:58,680 --> 00:07:59,920 Speaker 2: and I think this is the appropriate time to be 153 00:08:00,040 --> 00:08:03,000 Speaker 2: and to think about this, your legacy at the bank. 154 00:08:03,080 --> 00:08:04,840 Speaker 2: I'm not sure you ever really thought that we'd end 155 00:08:04,920 --> 00:08:08,680 Speaker 2: up here integrating Credit Suite in the circumstances we did. 156 00:08:08,960 --> 00:08:11,520 Speaker 2: But how would you like your legacy to remembered as 157 00:08:11,520 --> 00:08:13,240 Speaker 2: a leader of UBS. 158 00:08:14,360 --> 00:08:17,640 Speaker 1: I was very proud. I mean in a tragic moment 159 00:08:17,680 --> 00:08:20,120 Speaker 1: for Switzerland and for the banking industry, I was very 160 00:08:20,120 --> 00:08:22,800 Speaker 1: proud in twenty twenty three when I have two years 161 00:08:22,840 --> 00:08:25,480 Speaker 1: after I left that UBS was asked to step in 162 00:08:25,760 --> 00:08:29,840 Speaker 1: and stabilize and help stabilizing credit Swiss and being part 163 00:08:30,120 --> 00:08:32,760 Speaker 1: of the solution. That was for me, the you know, 164 00:08:33,000 --> 00:08:37,760 Speaker 1: almost reaching what I always thought I wanted to show 165 00:08:37,840 --> 00:08:41,880 Speaker 1: with our transformations in the first period. Right now, I 166 00:08:41,920 --> 00:08:44,720 Speaker 1: think that we have a solid bank, a stronger bank 167 00:08:44,760 --> 00:08:47,800 Speaker 1: than before, and I believe we are set for growth. 168 00:08:48,040 --> 00:08:50,800 Speaker 1: So the legacy is always to see that when you 169 00:08:50,920 --> 00:08:53,679 Speaker 1: leave after a couple of years, things are going even better. 170 00:08:54,040 --> 00:08:55,560 Speaker 2: So Jah, it's got to see it. Thanks for making 171 00:08:55,600 --> 00:08:57,320 Speaker 2: time for us. Thank you, We'll get you into the world. 172 00:08:57,559 --> 00:09:01,320 Speaker 2: That was the UBS CEO Sergio Ramoti speaking with Bloomberg 173 00:09:01,400 --> 00:09:04,200 Speaker 2: Surveillance right here at the World Economic Forum