UBS CEO Sergio Ermotti Talks Market Volatility

Summary

Podcast Summary: UBS CEO Sergio Ermotti Talks Market Volatility

Podcast: Bloomberg Talks
Host: John Ferro (Bloomberg Surveillance Anchor)
Guest: Sergio Ermotti, CEO of UBS
Location: Davos, Switzerland, World Economic Forum
Date: January 20, 2026

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Overview

In this episode, Bloomberg Surveillance's John Ferro sits down with UBS CEO Sergio Ermotti at the World Economic Forum in Davos. Their lively conversation focuses on the current landscape of market volatility, global asset diversification, the importance of the U.S. for investment, and UBS's integration of Credit Suisse. The discussion also touches on Ermotti's succession planning and reflections on his leadership legacy as he nears the completion of the Credit Suisse integration.

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Key Discussion Points & Insights

1. Global Market Volatility and Diversification

• Sergio Ermotti addresses recent turbulence in global financial markets and emphasizes the ongoing uncertainty.
  • “It’s probably the accumulation of issues that are now out there and not resolved that is becoming a little bit troubling in my point of view.” (01:18)
  • Ermotti predicts that volatility and unpredictability will persist, advocating for diversified investment strategies:

    “I think that staying diversified in financial markets nowadays is pretty important.” (01:33)

2. Debate: Diversification Away from U.S. Assets

• John Ferro asks whether “diversification” is a euphemism for selling U.S. assets, referencing recent trends and commentary from other investors.
• Ermotti dismisses the idea of moving away from U.S. assets as impractical and risky:
  • “Diversifying away from America is impossible… diversifying away from the US and also from the Dollar is a quite dangerous bet. You know, things can change rapidly and the US is the strongest economy in the world.” (02:09)
  • He further expresses confidence in U.S. innovation and economic strength.

3. The U.S. as a Top Investment Destination

• The U.S. remains the leading magnet for capital, supported by a recent PwC CEO survey.
• Ermotti provides UBS’s perspective on why America is still so attractive:
  • “We see two big levers. First of all, wealth creation, GDP growth, innovations…Last year the U.S. created 25 million of new millionaires. So…1,000 millionaires a day.” (03:12)
  • He notes UBS’s significant growth in Asia but reaffirms the U.S. as critical for wealth management.

4. UBS Growth Strategy: Organic vs. Acquisition

• Ermotti favors organic growth but highlights recent regulatory progress and internal improvements:
  • “We have enough to do organically…we just got a national charter application being approved by the FCC. We are expanding our interaction between the investment bank [and] wealth management people.” (04:08)

5. Swiss & European Banking Regulation: Capital Requirements

• Ferro raises the looming issue of increased capital requirements for Swiss banks.
• Ermotti is realistic about the slow progress due to political processes:
  • “Not quickly. I think it’s a political process…We’re going to find out the direction of travel in the middle of the second quarter.” (04:51)
• Despite regulatory distractions, Ermotti touts success in integrating Credit Suisse.

6. Credit Suisse Integration and Cost-Cutting

• The Credit Suisse integration is nearly complete; remaining priorities include cost reduction and operational streamlining:
  • “We still need to take out 3 billion of cost and finalize the restructuring. And then…we are prepared for growth.” (05:32)
  • Significant savings will come from IT and data center rationalization, with further workforce reductions possible.

7. Succession Planning

• Ferro quizzes Ermotti on succession—whether the next CEO will come from inside or outside the bank.
• Ermotti emphasizes steady internal leadership but remains open to external candidates:
  • “My job is to prepare and to present…as many candidates possible for internally. The role of the board is to also evaluate external candidates…an evolution is what we need, probably not a revolution.” (06:45)
  • On the timeline: “Succession is something that we manage every year.” (07:22)

8. Reflecting on Leadership and Legacy

• Ferro asks Ermotti to reflect on his legacy at UBS, particularly in the context of the dramatic Credit Suisse integration.
• Ermotti expresses pride in stabilizing the Swiss banking system in a moment of crisis:
  • “In a tragic moment for Switzerland and for the banking industry, I was very proud in 2023…that UBS was asked to step in and help stabilize Credit Suisse. Being part of the solution, that was for me…almost reaching what I always thought I wanted to show with our transformations.” (08:45)
  • He hopes to leave UBS “stronger than before” and set for “even better” things after his departure.

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Notable Quotes & Memorable Moments

• On Market Volatility:

  “Staying diversified in financial markets nowadays is pretty important.”
  — Sergio Ermotti (01:33)

• On Avoiding U.S. Exposure:

  “Diversifying away from the US and also from the Dollar is a quite dangerous bet.”
  — Sergio Ermotti (02:09)

• American Wealth Creation:

  “Last year the U.S. created 25 million of new millionaires.”
  — Sergio Ermotti (03:12)

• On Completing the Credit Suisse Integration:

  “We still need to take out 3 billion of cost and finalize the restructuring.”
  — Sergio Ermotti (05:32)

• On Succession:

  “Succession is something that we manage every year.”
  — Sergio Ermotti (07:22)

• On Legacy:

  “Being part of the solution [to stabilize Credit Suisse], that was for me…almost reaching what I always thought I wanted to show with our transformations.”
  — Sergio Ermotti (08:45)

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Timestamps of Key Segments

• Market Volatility & Diversification: 01:18 – 01:44
• Diversification Away from U.S.: 02:09 – 02:41
• Why America for Investment: 03:12 – 04:04
• UBS Growth Strategy: 04:08 – 04:36
• Swiss Banking Regulation: 04:51 – 05:25
• Credit Suisse Integration: 05:32 – 06:04
• Workforce and Cost-Cutting: 06:09 – 06:32
• Succession Planning: 06:45 – 07:46
• Reflections on Legacy: 08:45 – 09:25

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Conclusion

Sergio Ermotti presents a confident, pragmatic vision for UBS: resilience amid market volatility, cautious optimism about the U.S. economy, and disciplined management of major transformations like the Credit Suisse integration. His legacy, as he describes it, hinges not only on navigating crisis but ensuring the bank emerges stronger and prepared for future leadership transitions.

Transcript

[A]

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[B]

Get out to Davos, where Bloomberg surveillance anchor John Ferro is standing by. John, take it away. Hey guys. Live from Davos, Switzerland at the World Economic Forum. Standing by the king of Swiss banking. He might not like that introduction. It's such a multi the ubs. Good to see you.

[C]

Hi.

[B]

Thanks for braving the cold. I appreciate it. Before we, before we get into the bank, we're going to eat into this and start with financial markets. What a start to the trading week. Stateside equities open up gap Lower bond yields higher dollar weaker We've seen this movie before, last April, got over it pretty quickly. We've thrown a lot of this market in the last 12 months. It hasn't stuck. Is there something different about the way we're set up for 2026?

[C]

Well, I would say that it's probably the accumulation of issues that are now out there and not resolved that is becoming a little bit troubling in my point of view. So I think that this is the only. But we have to stay tuned for more volatility going forward and predictability and, and rapid changes. So I think that's staying diversified in financial markets nowadays is pretty important.

[B]

Let's get to what that word means, diversify. It feels like that's a diplomatic way of saying sell America sometimes and I'm not going to put words in your mouth. I'll tell you what others are saying. Pimco is talking about a multi year period of diversification away from US Assets. We've seen from others moving out of US Treasuries. There was a headline earlier on this morning about a, a very small Danish pension fund and they've got their own issues in Denmark right now given their relationship with America. What are you seeing develop?

[C]

Well, diversifying away from America is impossible. I think that in any major asset allocation one could probably think about having an overweight or underweight. But diversifying away from the US and also from the Dollar is a quite dangerous bet. You know, things can change rapidly and the US is the strongest economy in the world. The one was the highest level of innovation right now is a little bit bumpy, but I would say that I wouldn't really bet against the us.

[B]

There seems to be a difference between how the politicians and the policymakers talk about America right now in the backdrop for international relations and how a business person thinks of America, the economy and the opportunity. I've mentioned this stat a number of times already today about the survey that PwC put out. They surveyed four and a half thousand CEOs and the top destination for capital for, for investment America. And it was up on last year as a bank boss. Right now a CEO who's thinking about expanding around the world. Why is us still top of mind for you?

[C]

Well, because from our central point of view we, we see two big levers. First of all, wealth creation, GDP growth, innovations. And also more idiosyncratic to UBS is that we see potential for us to become more present, increase our market share. So that's one place. On the other end we are also very big in Asia. I mean we manage 1 trillion of assets there. We are growing very fast. The economy is growing. You know, half of the population in the world is living there and is creating new wealth. But you know, in the Americas, in the U.S. by the way, last year the U.S. created 25 million of new millionaires. So basically 1,000 millionaires a day. So it's a place for a financial institution. A wealth manager like UBS is a place to be.

[B]

Let's talk about that. Is that something you want to do organically or through an acquisition?

[C]

I think that we have enough to do organically by, by doing better what we can do, we are enhancing our, our product capabilities. We just got a national charter application being approved by the fcc. We are expanding our interaction between the investment bank, wealth management people. So I think that's more things we can do to get better and stronger.

[B]

It sounds like you're on the front foot at the same time as the bounce ring behind me. I'm reminded of where we are, Switzerland and the issues on the horizon potentially for the bank and that's capital requirements. That feels like a cloud that's hanging over this bank right now. How quickly do you think we can resolve it?

[C]

Not quickly. I think it's a political process. Most likely we're going to find out the direction of travel, the, you know, in the middle of the second quarter and then it's still a political process. But you're right that this is something that has been quite distracting for us. Although we have been quite successful in managing the integration of Ready Suisse is almost completed. We are almost, you know, three months to go and, and then, and then the vast majority of the job is done. So. But we look forward for a resolution also.

[B]

I'm sure you do. From the strategic standpoint, how is it holding you back? How is it distracting you? What are you prevented from doing that you would like to do right now.

[C]

At this point in time? To be fair, nothing. Because you know, executing the integration is the top priority. We cannot be complacent. Although 90, 85% is done, the last 15% is as important. We still need to take out 3 billion of cost and finalize the restructuring. And then, then we can, we are prepared for growth and that's the reason why we are investing top line, but also in efficiencies. AI and, and how we can become better and stronger.

[B]

Where do the costs come out? Are you satisfied with the size of the workforce? Does more need to be done on that side of things?

[C]

There is still, unfortunately that's the one, you know, a big chunk of the savings are going to come by, by disconnecting all the IT systems, data centers and, but also the risk of, you know, also painful still part of on the account, but it's within what we always announced. So, you know, I think the direction of travel is set.

[B]

This is the top of the to do list for you. And then someone else is going to step in eventually. You've offered your thoughts about where that someone might come from that you'd like to see them come from internally, from within the bank. You open to someone coming from the outside?

[C]

Well, we always need to be open. I think the board is not, you know, my, my job is to, is to prepare and to present to the as many candidates possible for internally. And the role of the board is to also evaluate external candidates and find the best solution for the future. But I would say the bank is very strong, my team is very strong and I do believe that, you know, an evolution is what we need is probably not a revolution. But you know, it all depends what's.

[B]

The timeline for that process now? Can you give us an idea at what point you present your ideas about who might succeed you?

[C]

Well, we always, every year I present ideas and you know, you offer them. Succession is not a process that you do, you know, only a few months or years before somebody leaves. Succession is something that we manage every year. And from my stand point of view. We need to be just prepared to have the best person for that moment.

[B]

When that person is selected, there is another seat that might open, and it's the chairperson seat. And I just wonder, when you step aside as CEO, has the chapter truly closed for you and the bank?

[C]

Well, look, you know, right now I'm very focused on finishing my job. Honestly, I think this is still very intense activity and, and, and, and that is going to be, you know, I need to reflect.

[B]

You realize people watching this won't really believe that you are a human being. You'll be thinking about the future and what comes next.

[C]

But people watching, they are not expecting me to respond.

[B]

That is true as well, particularly this gentleman right here who wants that response from you. Just a final question from me. I believe you first took the job as CEO back in 2011. As you look back on things, and I think this is the appropriate time to begin to think about this. Your legacy at the bank. I'm not sure you ever really thought that we'd end up here integrating Credit Suisse in the circumstances we did. But how would you like your legacy to be remembered as the leader of ubs?

[C]

I was very proud. I mean, in a tragic moment for Switzerland and for the banking industry. I was very proud in 2023 when I, two years after I left, that UBS was asked to step in and stabilize and help stabilize in Credit Suisse. And being part of the solution, that was for me, you know, almost reaching what I always thought I wanted to show with our transformations in the first period right now, I think that we have a solid bank, a stronger bank than before, and I believe we are set for growth. So the legacy is always to see that when you leave after a couple of years, things are going even better.

[B]

Sergio, it's good to see you. Thanks for making time for us.

[C]

Thank you.

[B]

We'll get you into the war. That was the UBS CEO, Sergio Adam, speaking with Bloomberg Surveillance, right here at the World Economic Forum.