UBS on an expansion drive in the US

UBS is looking to expand further in the US in a bid to gain a larger market share, just as European banks are closing their operations, by hiring a number of new bankers, such as ex-Credit Suisse employee Joseph Hershberger, an expert in asset management.

The U.S. investment bank of UBS is hiring new advisers and industry experts in a bid to gain a bigger market share where rival European banks are closing their operations.

U.S. banks such as J.P. Morgan, Goldman Sachs and Citigroup in recent years profited from the retraction of European investments banks from the biggest market, exploiting the opportunity to extend their market share.

UBS, the biggest Swiss bank, has also decided to stay and extend its presence. For that purpose, the institute is hiring new bankers, people such as Joseph Hershberger, who previously worked for Credit Suisse (CS). Hershberger is an expert in asset management, an industry segment for which a hike in mergers and acquisitions has been forecast.

Orcel Hirings

UBS investment banking boss Andrea Orcel hired more than 20 managing directors for the U.S. market in the past 12 months, the «Wall Street Journal» reported.

Orcel told Germany's «Wirtschaftswoche»: «The U.S. is and remains the biggest market by a wide margin. Currently, a few established banks are withdrawing, which creates opportunities for others to gain profitable market share.»

Keeping the Budget Under Control

UBS is making good progress in the U.S. and wants to grow further. «We continuously increase the number of staff. We are financing the expansion with the current operations and want to accelerate it further,» Orcel said.

The current expansion isn't to be compared with the plan in the first decade of the century, when UBS wanted to become the biggest investment bank on Wall Street. The bank, its staff and shareholders paid dearly for that strategy.

Orcel is applying a more moderate approach. As he doesn't want to overstretch, he is cutting costs at the same time as he is hiring further people. «I'm a realist, the market is very challenging. We will adjust our business to achieve the goals we have set.» The bank is maintaining its business model and the targets, but has to adjust to the changing environment, he added.

Big Deals

Orcel's bankers in the U.S. already landed a number of big deals. The bank has been hired to advise in the acquisition of Miller Coors by Molson Coors Brewing and in the $9 billion deal between Walgreens Boots Alliance and Rite Aid. UBS is also advising Syngenta in the proposed takeover by ChemCorp of China.