The History of UBS: 160 years of Swiss banking evolution

UBS Group AG, today one of the world's largest financial institutions, is the product of more than a century and a half of strategic mergers, international expansion and adaptation to economic crises. Its history illustrates the evolution of the Swiss and global banking sector, from the industrialisation of the 19th century to the contemporary challenges of globalised finance.

The history of UBS, Switzerland's largest bank 🇨🇭

The origins: 1862-1912

The history of UBS begins at the height of Switzerland's industrial revolution. In 1862, the Bank in Winterthur was founded in the town of Winterthur with an initial capital of 5 million Swiss francs. The bank specialised in financing industry and business, taking advantage of its rail connections and vast warehouses. During the American Civil War, the bank took advantage of soaring cotton prices.

A year later, in 1863, the Toggenburger Bank was founded in Lichtensteig. These two establishments laid the foundations for what was to become one of Switzerland's largest banks.

The founding event came in 1912 when Bank in Winterthur merged with Toggenburger Bank to form Union Bank of Switzerland (Schweizerische Bankgesellschaft). This consolidation marked the official birth of UBS and considerably broadened its geographical footprint and client base.

Post-war expansion: 1945-1990

After the Second World War, UBS continues to grow. The acquisition of Eidgenössische Bank, a large Zurich institution that had become insolvent, enables UBS to exceed one billion Swiss francs in assets for the first time and completes its operational transition to Zurich.

Although UBS opened an office in New York in 1946, the bank remained mainly focused on its domestic market for several decades. It was only gradually that the bank developed its international presence.

Internationalisation: 1980-1990

The 1980s and 1990s marked a turning point in UBS's strategy, with a series of major international acquisitions. In 1986, the bank made two major acquisitions in Europe: Phillips & Drew and Deutsche Länderbank.

1991 marked UBS's entry into the US market with the purchase of Chase Investors Management Corporation, the asset management arm of Chase Manhattan Bank, which at the time had over USD 30 billion in assets under management.

During the 1990s, UBS faced a period of internal turbulence. The bank came under fire from shareholders unhappy with its conservative management and relatively low return on equity. Martin Ebner, via his investment fund BK Vision, became the main shareholder and tried to force a major restructuring of operations.

In 1993, Credit Suisse outbid UBS to acquire Swiss Volksbank, the fifth-largest Swiss bank in difficulty, thus becoming Switzerland's largest bank for the first time. UBS responded by acquiring a group of smaller Swiss banks in 1994, followed by the Cantonal Bank of Appenzell Ausserrhoden in 1996. In 1997, UBS buys Schröder, Münchmeyer, Hengst & Co. from Lloyds TSB to enter the German banking market.

The great merger: 1997-1998

8 December 1997 marked a historic moment with the announcement of a merger between Union Bank of Switzerland and Swiss Bank Corporation. At the time, these two establishments were respectively the second and third largest banks in Switzerland, both behind Credit Suisse.

This all-equity merger creates UBS AG, a colossal new entity with over $590 billion in assets, becoming the world's second largest bank, just behind Bank of Tokyo-Mitsubishi. The merger also brings together the various asset management businesses of the two banks to create the world's largest asset manager, with around $910 billion under management.

Marcel Ospel, Chairman of UBS, initially planned to name the new entity “United Bank of Switzerland”, but finally opted for the simple acronym “UBS”. The combined entity is often referred to as “New UBS” to distinguish it from the former Union Bank of Switzerland.

However, 1998 proved to be a difficult year. UBS was involved in the collapse of the hedge fund Long Term Capital Management, contributing 300 million dollars to the 3.625 billion dollar rescue operation organised by the US Federal Reserve. This crisis, combined with the $1.25 billion settlement in the World Jewish Congress lawsuit over deposits from victims of Nazi persecution, leads to the resignation of Chairman Mathis Cabiallavetta and three other senior executives.

The Paine Webber era: 2000-2003

In 2000, UBS took a major step in its US expansion by acquiring Paine Webber, then the fourth largest brokerage firm in the US with 385 offices and 8,554 brokers. The acquisition propelled UBS into the world's leading wealth and asset management firm.

The division was initially named UBS PaineWebber, but in 2003 the century-old Paine Webber name was dropped in favour of UBS Wealth Management USA. This unification of the brand cost UBS CHF 1 billion in depreciation due to the loss of goodwill associated with the Paine Webber brand.

Consolidation and growth: 2000-2020

During the 2000s, UBS continued to expand and consolidate its operations. In December 2001, the investment arm of SBC Warburg Dillon Read was renamed UBS Warburg.

The financial crisis of 2008 hit UBS hard, but the bank survived better than some of its competitors. The following years were marked by a gradual reduction in its investment activities, redundancies and cost-cutting.

During this period, UBS also faced multiple international investigations into tax evasion, resulting in significant fines and changes to its banking confidentiality practices.

The mega-merger with Credit Suisse: 2023-2024

The most significant event in the recent history of UBS occurred in 2023. After years of difficulties for Credit Suisse, marked by scandals, major losses and capital flight, the situation became critical in March 2023.

On 19 March 2023, as part of a rescue plan coordinated by the Swiss government, the Swiss National Bank and the Swiss Financial Market Supervisory Authority (FINMA), UBS announced its intention to acquire Credit Suisse for CHF 3 billion (approximately USD 3.2 billion). This is an emergency transaction aimed at preventing a systemic financial crisis.

The deal, struck in a hurry before Asian markets opened on Monday morning, involves a share swap: Credit Suisse shareholders receive one UBS share for 22.48 Credit Suisse shares, or CHF 0.76 per share - just 1% of Credit Suisse's all-time high reached in 2007.

The Swiss Federal Council uses its emergency powers to allow the merger to go ahead without shareholder approval. In a controversial move, holders of Credit Suisse's Additional Tier 1 (AT1) instruments, worth USD 17 billion, have their securities written off to zero by decision of the Swiss authorities.

UBS formally completes the acquisition on 12 June 2023, creating a banking giant with a balance sheet of USD 1,600 billion. Credit Suisse Group AG is integrated into UBS Group AG, although the two entities will continue to operate separately during the transition period.

On 31 May 2024, the Group-wide legal merger between UBS AG and Credit Suisse AG is completed, with UBS AG as the surviving entity. Credit Suisse AG officially ceases to exist after 168 years of history. All assets, liabilities and contracts of Credit Suisse AG are transferred to UBS AG.

Integration and outlook: 2024-2026

The acquisition of Credit Suisse represents a colossal integration challenge for UBS. The bank aims to achieve gross cost savings of more than 13 billion dollars by the end of 2026. In October 2025, UBS appoints Beatriz Martin as Chief Operating Officer to oversee the integration of Credit Suisse. The bank confirms that it is on track to complete the integration by the end of 2026.

The merger creates Switzerland's largest financial institution, with a dominant position in global wealth management. UBS must now navigate the challenges of operational integration, the legal risks inherited from Credit Suisse, and the management of an institution that has become even more “too big to fail”.

A heritage of over 370 institutions

Today's UBS is the result of the consolidation of over 370 financial institutions over time. This complex history illustrates the evolution of the banking industry from a fragmented landscape of local and regional banks to a world dominated by global financial conglomerates.

With over 160 years of history, present in more than 50 countries, and now strengthened by the integration of Credit Suisse, UBS continues to write a new chapter in global banking history, navigating between Swiss tradition and global ambitions in an ever-changing financial environment.

Key figures for 2024

Financial results

- Net profit: USD 5.1 billion
- Total revenues: USD 48 billion (up 21% on 2023)
- Earnings per share: USD 1.52
- CET1 ratio: 14.3%
- Revenue per employee: USD 426,121
- Profit per employee: USD 56,942

Employees and global presence

- Employees: 110,323 (down 2.23% year-on-year following integration)
- Worldwide presence: over 50 countries
- Offices: over 800 locations
- In Switzerland: around 190 branches serving one in three households, 200,000 SMEs and over 90% of large Swiss companies
- Loans to the Swiss economy: CHF 350 billion
Targets for 2026
- Gross cost savings: USD 13 billion
- Return on CET1 capital: approx. 15%
- Cost/income ratio: less than 70%
- Integration of Credit Suisse: completion scheduled for the end of 2026