UBS’s pension fund will become the main vehicle for employees joining the bank following its acquisition of Credit Suisse, as the lender continues to realign its Swiss pension plans.
A spokesperson for UBS told IPE that new employees in Switzerland are automatically enrolled in the UBS pension fund.
Meanwhile, the bank is reshaping pension arrangements for all Swiss staff by 2027.
Credit Suisse’s pension fund board of trustees plans to integrate 1e retirement plans for bankers earning over CHF150,000 (€161,000) annually into the standard pension capital savings plan from the same date.
Despite the move, “no decision has been taken so far” on a potential merger of the two pension funds, the UBS spokesperson said.
“Merging pension funds is a complex undertaking in which various regulatory and legal aspects must be taken into account,” the spokesperson added.
Credit Suisse manages 1e plans separately in Pensionskasse 2, which held close to CHF900m in assets at the end of last year, according to the pension fund’s statement.
Eight fund products from the Credit Suisse Investment Foundation (CSA) and the UBS Investment Foundation 5 (UBS AST 5) – formerly Credit Suisse Investment Foundation 2 – are available to employees opting for 1e plans.
Rafael Lötscher, chief executive officer of pension provider PensExpert, told IPE that under UBS’s takeover, Credit Suisse employees in 1e plans will either be newly insured in the UBS 1e pension fund or moved to a “collective solution”.
“We assume this [moves by Credit Suisse on 1e plans] involves eliminating duplication. It seems to us from a business perspective that the company should settle on one 1e solution internally instead of two,” he said.
A consultant told IPE that employees with salaries above roughly CHF150,000 – the threshold for 1e plans at Credit Suisse – are likely to be transferred to a UBS 1e solution.
“This has more to do with the consolidation of the two companies and less with UBS not wanting to use this solution in the future,” the consultant added.
A growing but over-regulated market
According to the Federal Statistical Office, 9.45% of Switzerland’s 5.49 million employed earn more than CHF136,080 – the entry threshold for a 1e plan – representing around 520,000 potential participants, Lötscher said.
Currently, fewer than 50,000 people are insured in a 1e scheme.
“We are experiencing strong demand for employee participation in occupational pension schemes, particularly in 1e pension plans,” Lötscher said.
PensExpert manages CHF11bn, offering multiple pension solutions including 1e plans. Employers use 1e plans as a branding tool to attract skilled workers, alongside flexible working arrangements.
Members are protected from losses in 1e plans, as securities can be transferred to a new custodian bank if a bank or pension fund collapses, Lötscher noted.
However, he warned that over-regulation by occupational pension supervisor OAK BV is hampering market growth and could trigger a consolidation of 1e plan providers. OAK BV has set out requirements for transferring assets from non-1e to 1e pension institutions starting 1 January.
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