DETROIT (Reuters) – Insurers and industry experts say electric vehicle insurance premiums will keep rising as sales grow unless the car companies make it easier to access battery data and repair packs that are only slightly damaged in collisions.

Many carmakers in turn say their EV battery packs are repairable, though few seem willing to share access to battery data.

Ford Motor Co said it has simplified its battery module repair process and developed an easy way to replace the battery pack tray if the outside is damaged.

General Motors Co said its new Ultium batteries are designed to be repaired at the module level, which is “significantly less expensive than replacing the entire battery pack.” It also allows third-party access to battery data.

Nissan Motor Co said individual modules in its EVs can be replaced. When asked about third-party data access, a spokesman said “Nissan dealers have all the training and special tools required to assure the quality or repair needs of EV batteries.”

Renault said modules in its EVs can be repaired at specially designated “battery centres,” but did not respond to a question about third-party data access.

Stellantis said it does not repair batteries after accidents where the air bags deploy and added it strongly believes in data privacy.

(Reporting by Nick Carey in London and Paul Lienert in Detroit; Editing by Matthew Lewis)

By Nick Carey, Paul Lienert and Sarah McFarlane

LONDON/DETROIT (Reuters) -For many electric vehicles, there is no way to repair or assess even slightly damaged battery packs after accidents, forcing insurance companies to write off cars with few miles – leading to higher premiums and undercutting gains from going electric.

And now those battery packs are piling up in scrapyards in some countries, a previously unreported and expensive gap in what was supposed to be a “circular economy.”

“We’re buying electric cars for sustainability reasons,” said Matthew Avery, research director at automotive risk intelligence company Thatcham Research. “But an EV isn’t very sustainable if you’ve got to throw the battery away after a minor collision.”

Battery packs can cost tens of thousands of dollars and represent up to 50% of an EV’s price tag, often making it uneconomical to replace them.

While some automakers like Ford Motor Co and General Motors Co said they have made battery packs easier to repair, Tesla Inc has taken the opposite tack with its Texas-built Model Y, whose new structural battery pack has been described by experts as having “zero repairability.”

Tesla did not respond to a request for comment.

A Reuters search of EV salvage sales in the U.S. and Europe shows a large portion of low-mileage Teslas, but also models from Nissan Motor Co, Hyundai Motor Co, Stellantis, BMW, Renault and others.

EVs constitute only a fraction of vehicles on the road, making industry-wide data hard to come by, but the trend of low-mileage zero-emission cars being written off with minor damage is growing. Tesla’s decision to make battery packs “structural” – part of the car’s body – has allowed it to cut production costs but risks pushing those costs back to consumers and insurers.

Tesla has not referred to any problems with insurers writing off its vehicles. But in January CEO Elon Musk said premiums from third-party insurance companies “in some cases were unreasonably high.”

Unless Tesla and other carmakers produce more easily repairable battery packs and provide third-party access to battery cell data, already-high insurance premiums will keep rising as EV sales grow and more low-mileage cars get scrapped after collisions, insurers and industry experts said.

“The number of cases is going to increase, so the handling of batteries is a crucial point,” said Christoph Lauterwasser, managing director of the Allianz Center for Technology, a research institute owned by Allianz.

Lauterwasser noted EV battery production emits far more CO2 than fossil-fuel models, meaning EVs must be driven for thousands of miles before they offset those extra emissions.

“If you throw away the vehicle at an early stage, you’ve lost pretty much all advantage in terms of CO2 emissions,” he said.

Most carmakers said their battery packs are repairable, though few seem willing to share access to battery data. Insurers, leasing companies and car repair shops are already fighting with carmakers in the EU over access to lucrative connected-car data.

Lauterwasser said access to EV battery data is part of that fight. Allianz has seen scratched battery packs where the cells inside are likely undamaged, but without diagnostic data it has to write off those vehicles.

Ford and GM tout their newer, more repairable packs. But the new, large 4680 cells in the Model Y made at Tesla’s Austin, Texas, plant, are glued into a pack that forms part of the car’s structure and cannot be easily removed or replaced, experts said.

In January, Tesla’s Musk said the carmaker has been making design and software changes to its vehicles to lower repair costs and insurance premiums.

The company also offers its own insurance product in a dozen U.S. states to Tesla owners at lower rates.

Insurers and industry experts also note that EVs, because they are loaded with all the latest safety features, so far have had fewer accidents than traditional cars.

‘STRAIGHT TO THE GRINDER’

Sandy Munro, head of Michigan-based Munro & Associates, which tears down vehicles and advises automakers on how to improve them, said the Model Y battery pack has “zero repairability.”

“A Tesla structural battery pack is going straight to the grinder,” Munro said.

EV battery problems also expose a hole in the green “circular economy” touted by carmakers.

At Synetiq, the UK’s largest salvage company, head of operations Michael Hill said over the last 12 months the number of EVs in the isolation bay – where they must be checked to avoid fire risk – at the firm’s Doncaster yard has soared, from perhaps a dozen every three days to up to 20 per day.

“We’ve seen a really big shift and it’s across all manufacturers,” Hill said.

The UK currently has no EV battery recycling facilities, so Synetiq has to remove the batteries from written-off cars and store them in containers. Hill estimated at least 95% of the cells in the hundreds of EV battery packs – and thousands of hybrid battery packs – Synetiq has stored at Doncaster are undamaged and should be reused.

It already costs more to insure most EVs than traditional cars.

According to online brokerage Policygenius, the average U.S. monthly EV insurance payment in 2023 is $206, 27% more than for a combustion-engine model.

According to Bankrate, an online publisher of financial content, U.S. insurers know that “if even a minor accident results in damage to the battery pack … the cost to replace this key component may exceed $15,000.”

A replacement battery for a Tesla Model 3 can cost up to $20,000, for a vehicle that retails at around $43,000 but depreciates quickly over time.

Andy Keane, UK commercial motor product manager at French insurer AXA, said expensive replacement batteries “may sometimes make replacing a battery unfeasible.”

There are a growing number of repair shops specializing in repairing EVs and replacing batteries. In Phoenix, Arizona, Gruber Motor Co has mostly focused on replacing batteries in older Tesla models.

But insurers cannot access Tesla’s battery data, so they have taken a cautious approach, owner Peter Gruber said.

“An insurance company is not going to take that risk because they’re facing a lawsuit later on if something happens with that vehicle and they did not total it,” he said.

‘PAIN POINTS’

The British government is funding research into EV insurance “pain points” led by Thatcham, Synetiq and insurer LV=.

Recently adopted EU battery regulations do not specifically address battery repairs, but they did ask the European Commission to encourage standards to “facilitate maintenance, repair and repurposing,” a commission source said.

Insurers said they know how to fix the problem – make batteries in smaller sections, or modules, that are simpler to fix, and open diagnostics data to third parties to determine battery cell health.

Individual U.S. insurers declined to comment.

But Tony Cotto, director of auto and underwriting policy at the National Association of Mutual Insurance Companies, said “consumer access to vehicle-generated data will further enhance driver safety and policyholders’ satisfaction … by facilitating the entire repair process.”

Lack of access to critical diagnostic data was raised in mid-March in a class action filed against Tesla in U.S. District Court in California. 

Insurers said failure to act will cost consumers.

EV battery damage makes up just a few percent of Allianz’s motor insurance claims, but 8% of claims costs in Germany, Lauterwasser said. Germany’s insurers pool data on vehicle claims data and adjust premium rates annually.

“If the cost for a certain model gets higher it will raise premium levels because the rating goes up,” Lauterwasser said.

(Reporting by Nick Carey and Sarah McFarlane in London, Paul Lienert in Detroit, Gilles Guillaume in Paris and Giulio Piovaccari in MilanAdditional reporting by Victoria Waldersee in BerlinEditing by Ben Klayman and Matthew Lewis)

By Howard Schneider

WASHINGTON (Reuters) – At an early January meeting of the Virginia Bankers Association, executives were already nervous that Federal Reserve interest rate increases were making it hard to compete for deposits. 

“Everywhere I go in the industry people are feeling that kind of pressure,” the featured speaker of the day, Richmond Fed President Thomas Barkin, said in response to a question from the audience. The influence of Fed rate hikes “is going to hit…That is how it is designed.”

When Fed officials meet this week the suddenly urgent question is whether the level of pressure on the banking industry has become so great it risks a larger financial crisis – the sort of event associated with deep and hard-to-arrest economic downturns – and warrants a slowdown or pause to further rate increases.

The Fed and global central banks, after a tense 10 days with banks teetering in the U.S. and Europe, launched a second round of weekend efforts to buttress the system by expanding the Fed’s ability to ship dollars where needed. Separately a deal was struck for UBS to acquire the troubled Credit Suisse in a takeover reminiscent of the global financial crisis 15 years ago.

After the announcement Treasury Secretary Janet Yellen and Fed Chair Jerome Powell issued their second Sunday afternoon statement of reassurance in as many weeks, saying as Asian markets prepared to open for the week that “the capital and liquidity positions of the U.S. banking system are strong, and the U.S. financial system is resilient.”

The issue for Powell and his colleagues is whether the calming words and a bank lending new program are enough to stem broader problems and allow them to proceed with what has been their priority to now: Combating inflation with the ever-higher interest rates now bedeviling the banking system.

If banking stress was to some degree hiding in plain sight, with deposits falling since the middle of last year and some common bank assets losing value as interest rates rose, the flashpoint was not hit until March 10 when the failure of the Silicon Valley Bank triggered doubts about the health of a swath of mid-sized banks and raised concerns of an old-fashioned deposit run.

Economists and investors so far expect the Fed to proceed with another quarter point interest rate increase at its March 21-22 meeting, but only because inflation poses such a persistent risk policymakers won’t want to divert from efforts to control it. The financial system, meanwhile, has been thrown extra support under a new Fed lending program for banks, while its traditional lender-of-last-resort cash window was tapped for a record $150 billion.

Graphic: Bank deposits turn lower – https://www.reuters.com/graphics/USA-FED/BANKS/zdvxdqrjbvx/chart_eikon.jpg

Fed officials gather this week having agreed bank stress poses a “systemic risk” to the economy, and “in any other hiking cycle this…would end the tightening process and perhaps send it into reverse,” said Ed Al-Hussainy, senior rates analyst at Columbia Threadneedle Investments. “The difference today is the Fed’s focus on inflation.”

In a recent Reuters poll 76 of 82 economists said they expect the Fed to approve a quarter point rate increase at this week’s meeting, lifting the target federal funds rate to a range between 4.75% and 5%. A similarly strong majority expect a further increase at a future Fed session.

The Fed’s policy statement will be released Wednesday at 2 p.m. (1800 GMT) along with closely watched projections from officials for the policy rate at year’s end, perhaps the best clue to how recent financial stress has reshaped the Fed’s outlook.

As of December officials expected the policy rate would rise to around 5.1% by year’s end.

Graphic: Fed view of 2023 policy rate Fed view of 2023 policy rate – https://www.reuters.com/graphics/USA-FED/INFLATION/zdvxdxmywvx/chart.png

HISTORY LESSON

Worried about losing control over inflation that hit a 40-year-high 9.1% in June, the Fed over the past 12 months increased rates at the fastest pace since former Fed Chair Paul Volcker faced an even worse outbreak of hot prices.

The experience of 1970s-era central bankers informed not only the extent of the rate increases, with the policy rate rising 4.5 percentage points from near zero as of last March. Powell and his colleagues also insisted the lesson from decades ago was that rates needed to rise to a restrictive level then stay there until inflation was defeated — not “stop and go” in a pattern of hikes and cuts they felt would not achieve price stability.

To many officials, the fact that inflation has been slow to respond to higher rates, while the economy has continued to grow and spin out hundreds of thousands of new jobs a month, was evidence rates needed to move higher still. Because nothing had “broken” in the economy, further rate increases were seen as cost-free.

On March 10 something broke, symbolically in the failure of the country’s 16th largest bank, but more broadly in the perception that the system might not be as stable as Fed officials have felt in the years since regulatory reforms forced financial firms to better buffer themselves.

None of those reforms prevented SVB from funneling its rapidly growing deposits into long-term government bonds that lost value as the Fed raised rates. That left the firm potentially short of the cash needed when depositors began to demand withdrawals — a dynamic the Fed worried could spread to other banks facing similar constraints.

For Fed policymakers the episode raises the possibility that they have repeated a mistake they had sworn to avoid and gone too far in raising rates.

The Fed’s recent policy statements have said that rate decisions would take into account “the lags with which monetary policy affects economic activity and inflation,” but until now respect for the delayed impact of past rate hikes has done little to change the Fed’s course.

Economists last week began marking down their growth forecasts anticipating that banking stress means a credit contraction lies ahead, with less money in the pockets of homeowners and businesses. To a degree that is what the Fed wants when it tightens monetary policy, as long as the drop in lending is orderly and doesn’t go too far.

“We expect that stress on smaller banks could result in a tightening of lending standards, exerting an incremental growth drag” on gross domestic product of as much as a half point, Goldman Sachs analysts wrote last week, among the few outside forecasters to say they expect the Fed to pause its rate hikes to take stock.

Markets are hardly settled. Even with a separate intervention by bank industry giants to shore up the books of the First Republic Bank, shares of the lender plummeted Friday amid broader stock market losses. The Fed has announced a review of its supervision at SVB to see if warning signs were missed.

Still, for the Fed “to pause here would provide no relief to the idiosyncratic issues for banks, and the Fed would risk losing all of the hard-fought progress made” in defending its 2% inflation goal, wrote Jefferies analyst Tom Simons. “The optics of a pause remains unacceptably high.”

(Reporting by Howard Schneider; Editing by Andrea Ricci and Dan Burns)

SINGAPORE (Reuters) – A Singapore shoe recycling project will be subject to surprise inspections following a Reuters investigation that found footwear it donated to the scheme was not recycled, Singapore’s minister of culture said on Monday.

U.S. petrochemicals giant Dow Inc and Sport Singapore, a government agency, had pledged that the shoes would be ground down to make playgrounds and running tracks.

The investigation, using location trackers hidden inside the soles of shoes, found sneakers donated by Reuters in Singapore had instead been exported to Indonesia for resale.

That also contravened a 2015 ban by Indonesia on such practices which was put in place for hygiene purposes and to protect its local textile industry.

Presented with Reuters findings, Dow and Sport Singapore opened an investigation and later terminated the contract of Yok Impex, a local textile exporter that was subcontracted to collect shoes from donation bins.

They issued a statement after the publication of the Feb. 25 story apologising to the public for a “lapse” in its recycling supply chain.

“What resulted, as far as we can tell, from the investigation … came from a lax system,” Minister for Culture, Community and Youth Edwin Tong said, responding to questions in parliament.

He added that in addition to unannounced inspections for contractors hired to collect the shoes, companies that export textiles or footwear will not be employed again.

“The project partners have taken steps to tighten the process chain,” Tong said, adding that learning points would be shared with other recycling projects in Singapore.

Indonesia also said this month it would tighten customs checks at small ports to crack down on the illegal import of second-hand shoes as a result of Reuters’ findings.

(Reporting by Joe Brock; Editing by Edwina Gibbs)

By Chavi Mehta and Casey Hall

(Reuters) -PDD Holdings Inc, which owns discount e-commerce platforms Pinduoduo and Temu, missed expectations on Monday for fourth-quarter revenue as China’s post-reopening consumer recovery remains patchy.

U.S.-listed shares of PDD Holdings fell as much as 13.9% in premarket trading.

PDD reported revenue of 39.82 billion yuan ($5.79 billion) for the quarter ended Dec. 31, up 46% year-on-year, but this fell short of estimates for 41.01 billion yuan, based on Refinitiv data.

The group had reported 65% revenue growth in its third- quarter earnings last November.

PDD’s fourth quarter included only the first few weeks of China’s reopening from its strict zero-COVID rules in December.

The company’s revenue growth compares with single-digit gains reported by Chinese competitors Alibaba and JD.com for the same period, leading Bo Pei, an analyst at US Tiger Securities, to note that “investors do seem to be a bit overreacting to the miss.”

PDD Holdings Chairman and Chief Executive Chen Lei told analysts on a call following the earnings announcement there was “strong resilience” in China’s consumption market in the quarter.

“Sales volumes of daily essential products on the platform showed steady growth, meanwhile consumer demand for high quality merchandise is growing, categories like mobile phones, beauty and cosmetics and baby products all had decent growth,” he said.

JD.com warned in March that consumer confidence in China would take time to rebuild amid economic uncertainties.

China’s total retail sales contracted 1.8% in December, while the country’s economic growth in 2022 slumped to one of its worst levels in half a century.

Discounting campaigns by rivals have also intensified competition for PDD, which has gained market share since it first came on the scene in 2015 by targeting price conscious consumers with discounted goods.

“We believe that healthy competition is beneficial to consumers and the entire industry but when competition intensifies, sometimes peers react [by going] in a different direction,” Chen said in an apparent nod to increased discounting in the market.

“We need to focus on our own healthy development and embrace industry competition even when sometimes it involves unsustainable practices from peers,” he added.

PDD’s fast-growing international platform Temu, which was launched in September to U.S. shoppers, sells a variety of goods, from shoes, jewellery, electronics and homewares directly from Chinese merchants.

Temu’s gross merchandise value – the total sales before expenses – increased to $192 million in January from $3 million in September, based on analysis from data company YipitData.

Temu’s 2023 expansion will include rollouts in Canada, Australia, New Zealand and the UK.

“Different markets and different regions have many differences and we still have a lot to learn and a lot to improve,” Chen said. ​

($1 = 6.8799 Chinese yuan renminbi)

(Reporting by Chavi Mehta in Bengaluru and Casey Hall in Shanghai; Editing by Shinjini Ganguli, Jane Merriman and Susan Fenton)

By John Revill

ZURICH (Reuters) -Credit Suisse and UBS could benefit from more than 260 billion Swiss francs ($280 billion) in state and central bank support, a third of the country’s gross domestic product, as part of their merger to buffer Switzerland against global financial turmoil, documents outlining the deal show.

Swiss authorities announced on Sunday that UBS had agreed to buy rival Swiss bank Credit Suisse in a shotgun merger aimed at avoiding more market-shaking turmoil in global banking.

UBS said it will pay $3.2 billion for the 167-year-old flagship while the government said UBS would also take on the first $5.4 billion in losses from unwinding derivatives and other risky assets.

The deal, however, involves a large amount of public support, with three tranches of liquidity and loans, as well as a pledge from the Swiss government to absorb up to 9 billion francs in potential losses from the takeover.

The total of 259 billion francs of support is equivalent to a third of Switzerland’s entire economic output, which stood at 771 billion francs last year.

“The government’s going to have to say to voters why they are putting citizens’ money, taxpayer money at risk to bail out a bank that was predominantly servicing the ultra wealthy, doing some pretty extraordinary things with its investment bank and paying people crazy amounts of money relative to what the man in the street gets paid,” one former global bank CEO, who did not wish to be identified, told Reuters.

In a memo seen by Reuters that was sent to staff on Sunday after the deal announcement, Credit Suisse reassured staff that their bonuses would be paid in full.

Public support for the bank comes in three ways.

Credit Suisse had already been drawing on the Swiss National Bank’s (SNB) emergency liquidity assistance scheme.

Credit Suisse said last Wednesday it would take 50 billion francs from the scheme, which provides funding secured against collateral such as mortgages and securities. As long as the bank has more collateral, it can draw down further such funding.

Central bank data on Monday indicated that Credit Suisse was likely already accessing the fund.

On top of this, the Swiss National Bank offered the combined bank an emergency liquidity loan of up to 100 billion Swiss francs. That loan is protected in the event of a default.

The third tranche of support allows Credit Suisse to draw on a further 100 billion francs of funding via a public liquidity backstop, which is explicitly guaranteed by the Swiss government.

The SNB declined to comment about whether Credit Suisse or UBS had made use of the money on offer.

Credit Suisse has been the biggest name ensnared in global market turmoil unleashed by the recent collapse of U.S. lenders Silicon Valley Bank and Signature Bank.

UBS and Credit Suisse were both in a group of the 30 global systemically important banks watched closely by regulators. A failure by Credit Suisse failure would ripple throughout the entire financial system, the Swiss government said late on Sunday.

“The bankruptcy of Credit Suisse would have had a huge collateral damage – on the Swiss financial market also, risk of contagion for UBS and other banks, and also internationally,” Swiss Finance Minister Karin Keller-Sutter told a press conference.

($1 = 0.9278 Swiss francs)

(Reporting by John Revill; Additional reporting by Sinead Cruise in London; editing by John O’Donnell and Susan Fenton)

By John O’Donnell and Stefania Spezzati

LONDON (Reuters) -UBS Group has emerged as Switzerland’s one and only global bank with a state-backed rescue of its smaller peer Credit Suisse, a risky bet that makes the Swiss economy more dependent on a single lender.

The move announced late on Sunday in Zurich capped a race against time by regulators to avert a meltdown. Switzerland is pledging roughly 260 billion francs($170 billion) in loans and guarantees to underpin the new group, guarding against further risks undermining the lender.

The transaction – the first rescue of a global bank since the financial crisis of 2008 – grants enormous clout to UBS, ridding it of its main rival. It will change the landscape of banking in Switzerland, where branches of Credit Suisse and UBS are dotted everywhere, sometimes just metres apart.

The banks, two of the most systemically relevant in global finance, hold combined assets of up to 140% of Swiss gross domestic product in a country heavily dependent on finance for its economy.

Following the 2008 financial crash, politicians pledged never to bail out banks again. The Credit Suisse rescue, orchestrated with public money, shows banks’ continued vulnerability and how their problems can quickly rebound on their home country.

Rescuing Credit Suisse alone came with a price tag of roughly 260 billion francs of publicly backed loans and guarantees – a third of the Alpine state’s economic output.

“The terms of the takeover are very much in UBS’s favour,” said Tobias Straumann of the University of Zurich. “They were in a strong negotiating position because they didn’t want the deal.”

“Under normal circumstances, I would say it is an absolutely fantastic deal for UBS,” said Johann Scholtz, an analyst at Morningstar.

REVERSAL OF FORTUNES

Soon after the announcement, central banks including the U.S. Federal Reserve, the European Central Bank and the Bank of Japan said they would enhance dollar swap lines, helping calm investors rattled by turmoil in the banking sector.

The failure of two U.S. banks and a rout in Credit Suisse shares have sent shock waves through markets over the past week.

UBS will pay $3.2 billion for 167-year-old Credit Suisse and assume at least $5.4 billion in losses from unwinding its portfolio of derivatives and other risky assets. Credit Suisse had a market value of about $8 billion at the close on Friday.

Holders of Credit Suisse’s Additional Tier 1 bonds will get wiped out.

The deal marks a twist of fate for the banks. During the great financial crash, it was UBS and not Credit Suisse that needed state support. 

The banks’ fortunes have diverged sharply over the past year. UBS earned $7.6 billion in profit in 2022, while Credit Suisse lost $7.9 billion. Credit Suisse’s shares were down 74% from a year ago, while UBS’s are relatively flat.

UBS becomes the undisputed global leader in managing money for the wealthy, with UBS’s leading position in China now complemented by Credit Suisse’s strength in the rest of Asia, the fastest growing region.

UBS also gets to keep the jewel in Credit Suisse’s crown, the domestic bank.

“In the past, when a deal between Credit Suisse and UBS was discussed, a sticking point would be concentration, especially in the domestic market,” said Morningstar’s Scholtz. “It is also the most stable part of the business, that generates quite a lot of cash.”

UBS is also taking out a big competitor in securities trading. UBS earned $7.1 billion in revenue from buying and selling stocks, currencies and bonds. Credit Suisse posted about$3.2 billion last year.

STILL SWISS Credit Suisse’s demise has been a blow to Switzerland’s reputation for banking and sent shockwaves through global finance.

At a news conference announcing the deal, finance minister Karin Keller-Sutter defended the rescue, saying it was good for Credit Suisse account holders, including her. She said she also banked with UBS. That choice of banks will soon end.

“This solution has risks,” she conceded, playing down any concerns about the size of the new bank, arguing that any alternative to resolve Credit Suisse’s problems risked “irreparable economic turmoil”.

Seated to her right, UBS Chair Colm Kelleher said the new group would be trimmed of risks, such as investment banking, to fit UBS’s conservative culture.

“A new UBS will remain rock solid,” he said.

Credit Suisse Chair Axel Lehmann, in contrast, was downcast as his bank proved unable to bounce back from a series of scandals and losses.

Late last year, speculation that the bank would go bust drove clients to pull out tens of billions, sealing its fate.

He described Sunday as a “historic, sad day”.

Employees at the headquarters in Zurich are bracing for massive job cuts, with 10,000 positions potentially on the line, sources told Reuters on Saturday.

Still, it won’t be all plain sailing for UBS.

The bank faces risks to complete the deal, potential litigation charges, and regulators may ask the lender to hold more capital in the future, said analysts at Jefferies.

Crucially, management will be distracted by this deal for many months, maybe years, they said.

“We will change, but we will not change that much,” said UBS Chief Executive Officer Ralph Hamers, who will lead the new banking behemoth. “We will still be Swiss.”

($1 = 0.9268 Swiss francs)

(Reporting by John O’Donnell and Stefania Spezzati; Additional reporting by John Revill, Carolina Mandl, Chiara Elisei, Lananh Nguyen, Saeed Azhar and Tom Sims; Writing by Elisa Martinuzzi)