UBS mulls outsourcing 5,000 jobs in two years

Opportunity to win new business for the existing Indian IT vendors

 

Switzerland-based banking and wealth management firm UBS is considering outsourcing about 5,000 jobs over the next two years, a majority of which may come to India, according to people familiar with bank's plans. This signifies an opportunity to win new business for Indian IT vendors such as Wipro and Infosys Technologies that already work with the Swiss bank.

 

UBS recently appointed consulting firm McKinsey to advise it on the outsourcing process. The decision to outsource thousands of jobs is in line with the ailing bank's cost-cutting strategy. UBS chief exec Oswald Grübel has already announced 7,500 job cuts across the firm till 2010. Switzerland's largest bank by assets has accumulated more than $53 billion in writedowns in the global financial crisis and had to receive financial aid from the Swiss government. The bank is an important client for both Wipro and Infosys. While Wipro, India's third largest software-services firm by revenues, gets over $50 million in annual revenues from UBS, second-ranked Infosys derives about $40-50 million. Apart from these firms, other vendors for UBS include TCS, Polaris, Cognizant and Headstrong.

 

In reply to an email questionnaire on the bank's outsourcing plans, UBS spokesman in Hong Kong, Mark Panday, said, "UBS does not comment on market speculation or rumour. UBS has a well-defined offshoring strategy, including judicious use of India and other locations around the world. Offshoring has allowed UBS to reap many benefits, including improved quality, reduced operational risk, new revenue opportunities, cost savings and, importantly, access to talent."

 

Source: The Economic Times