Accounting firm Oliver Wyman has been hired by multinational investment bank UBS to guide the integration of Credit Suisse. The firm was one of more than a dozen consultancies that bid on the engagement, with the Financial Times suggesting that Oliver Wyman joined other leading global firms such as McKinsey & Company, Bain & Company, and Boston Consulting Group on the shortlist.
The rapidly growing firm will provide merger integration services, bringing the two companies together following the purchase and ensuring they are able to operate as efficiently and as effectively as possible. UBS Chairman Colm Kelleher commented to reporters that “this is the biggest single financial transaction since 2008,” referring to the financial crisis following the sudden collapse of investment bank Lehman Brothers and the resulting global recession. Neither UBS nor the consultancies that bid on the engagement commented on the bidding and selection process.
UBS’ March purchase was driven by the impending collapse of Credit Suisse, one of Switzerland’s leading financial institutions for well over a century, as the bank faced a liquidity crisis after years of scandal and accusations of mismanagement. The move helped shore up the international financial system during the sudden collapses of several large banks, including the U.S.-headquartered Silicon Valley Bank.
The merger of the two largest Swiss banks will result in a mega-bank twice the size of the entire economy of Switzerland, potentially compounding the risk to the global economy should UBS face similar liquidity issues. The nation’s taxpayers will foot the bill for a government guarantee of 9 billion francs ($10 billion USD) to cover any potential losses resulting from the emergency acquisition, and the Swiss National Bank has also agreed to provide up to 100 billion francs (nearly $112 billion USD) in liquidity to bring the rapidly conceived and executed deal to a successful close.
Given the rapid timeline and extraordinary measures deployed to rescue Credit Suisse, there is a very real chance that the merger and subsequent integration may unearth still more skeletons from the beleaguered bank’s closet, compounding its already tainted reputation. UBS may continue to face fallout from its new purchase’s previous choices in the coming months as it proceeds with Oliver Wyman’s assistance.