Media reports claim UBS and Credit Suisse are planning big job cuts although Switzerland's two largest banks declined to comment.

UBS will cut around 5,000 jobs to save SFr1.0 billion (around $1.20 billion) and Credit Suisse plans to shed about 1,000 staff in a cost-cutting programme, according to newspaper reports that cited unnamed sources.

"Cost management continues to be a priority for UBS. We review possibilities to improve efficiency and optimize costs on an ongoing basis," according to an emailed statement from UBS that was sent to WealthBriefing. The bank declined to comment on specific details as carried in press reports, describing them as “speculation”.

It is unclear as to which regions of the world, such as Europe, Americas or Asia-Pacific might be most heavily affected if these press media reports are accurate. Neither banks would comment.

UBS and Credit Suisse issue second-quarter results on 26 and 28 July respectively.  

UBS wealth management head Juerg Zeltner was quoted last week as saying the bank needs to rein in costs given tough market conditions while chairman Kaspar Villiger also said cost cuts were inevitable. UBS is the world’s third-largest wealth management firm by size of assets, according to Scorpio Partnership, with Credit Suisse ranked fifth.

Both banks have been buffeted by the global credit crunch in its aftermath, although UBS suffered by far the largest losses and has also been scarred by a prominent tax evasion case in the US, now concluded. More recently, the strength of the Swiss franc against currencies such as the dollar and euro has been a drag on revenues. However, UBS’ fortunes are on the turn: Morgan Stanley has placed UBS among its “most preferred” list of European financials, for example, citing a turnaround in its investment and private banking arms. Swiss banks must contend with capital adequacy requirements even more stringent than the Basel III international rules laid down for the world’s largest banks.

A report by Handelszeitung newspaper quoted an “unnamed UBS insider” saying that the cost-cutting programme had still to be agreed by the board but should be announced on 26 July. The publication has also said that thousands of jobs were threatened at UBS and rival Credit Suisse but gave no numbers.

Credit Suisse is to cut about 1,000 jobs to save SFr800 million, according to the Handelszeitung newspaper, which also used an unnamed insider for its report.

The Handelszeitung quoted an insider as saying UBS was planning to save about SFr90 million annually by closing 27 offices in Zurich and concentrating staff in five big centres.