UBS is considering delaying its second-quarter results as long as possible as the bank grapples with the financial and political complexities of the Credit Suisse rescue, according to people familiar with the matter.
The bank will report its results on July 25, but executives are considering delaying publication until the end of August, when they can also give investors an update on their plans for Credit Suisse’s domestic business, the people said.
The rescue of Credit Suisse, planned by Swiss authorities in March, is expected to be the most far-reaching and complicated bank merger since the financial crisis. Parts of the deal have already been challenged by politicians and lawyers.
UBS executives had hoped to finalize the deal in early June – the deal has already been signed by EU competition authorities.
But details of the Swiss government aid have yet to be finalized, meaning it won’t be finalized until this week at the earliest, according to people involved in the planning.
Another complexity faced by the UBS finance team is combining the accounting systems of the two banks, each of which follows different standards. UBS follows International Financial Reporting Standards, while Credit Suisse uses generally accepted accounting principles, which are more common among US companies.
Under IFRS, companies are encouraged to publish their interim results no later than 60 days after the end of the reporting period.
The shotgun marriage between the banks has drawn criticism in Switzerland; A poll released shortly after the deal found that three-quarters of voters wanted the megabank broken up.
A month later, Swiss parliamentarians voted in a symbolic protest against the SFr 109 billion financial package backing the deal.
Last week, the country’s left-wing Social Democratic Party said it had drawn up plans to halve the bank’s post-merger balance sheet, from SFr 1.5 trillion to closer to its gross domestic product of SFr 734 billion.
With the Swiss federal election in October, politicians have expressed their anger at the SFr9bn support that the government has agreed to provide for UBS to absorb losses if they go beyond an initial SFr5bn that the company will carry itself.
But UBS executives are doing everything they can to show investors they will try to limit their reliance on the state and avoid government support. Recently returned CEO Sergio Ermotti has insisted it is “exceptionally unlikely” that Swiss taxpayers will incur losses from the takeover.
Ermotti also dismissed fears that the bank’s size will be a problem for Switzerland, saying it was more important that UBS had agreed to take over a failing institution.
UBS’ original plan to merge its domestic bank with Credit Suisse has sparked concerns in Switzerland over fears of branch closures and job cuts. UBS executives have since said “all options are on the table” about plans for the Credit Suisse business, with a final decision expected by the end of August.
UBS declined to comment on its discussions about delaying second-quarter results.
Credit Suisse has enlisted its longtime adviser Deloitte to prepare the accounts for UBS to complete the deal.
