Sergio Ermotti may extend his tenure as chief executive of UBS into the second half of 2027 to shepherd the bank through a period of regulatory change and to give directors more time to identify a suitable successor, people familiar with the matter said.
The board is seeking clearer guidance on how new Swiss rules could affect the bank's capital requirements and is uncertain whether those currently viewed as internal successor candidates are ready to take the top job, according to two sources. That uncertainty has increased the board's openness to the idea of appointing an external candidate, one source and a third person familiar with board discussions said.
UBS, which holds its annual shareholder meeting on Wednesday, declined to comment. It was not clear whether any preferred external candidates have emerged. No final decision has been made on CEO succession, and those close to the situation said the board is unlikely to rush a choice.
Ermotti, who previously served as UBS CEO from 2011 to 2020, returned to the role in 2023 to oversee the integration of Credit Suisse. He has repeatedly said he prefers an internal successor and last month indicated he would remain as chief executive until at least April 2027, while leaving open the possibility of staying beyond that date. Extending his stay would give the bank additional time to prepare internal contenders or to pursue an external hire for a CEO who will have led UBS longer than any other chief executive since the modern group formed after a 1998 merger.
Among board considerations is the nationality of top executives. The bank wants at least one of the top two roles to be held by a Swiss citizen, the sources said. Ermotti, a 65-year-old Swiss national, has signalled he is prepared to move into the chairmanship of UBS if the board and regulators agree to that arrangement.
Swiss financial regulator FINMA generally requires a cooling-off period of at least 12 months when a CEO becomes chair, though it allows a chief executive to join the board directly beforehand, FINMA said.
Ermotti has committed to remain until the Credit Suisse integration is complete, a milestone UBS once projected could occur as early as late 2026 or into next year. The timetable has become more uncertain amid discussions over tougher post-Credit Suisse rules that Swiss authorities plan to introduce for banks.
Those proposed measures are a major point of contention. Depending on their final design, the rules could require UBS to hold up to $22 billion in additional capital, though the ultimate stringency and exact requirements remain unclear. Even with indications that initial government proposals might be softened, the bank's board wants clarity before installing a new CEO, one source said.
If the regulatory changes prove especially onerous, UBS would need to expand contingency planning. That could include, among other steps, considering a relocation of the group's headquarters abroad. While UBS publicly maintains it intends to remain a Swiss bank, people familiar with its deliberations say the group is closely monitoring steps by U.S. authorities to deregulate aspects of banking, and sees the United States as a possible alternative if Switzerland becomes less viable. Any decision on strategic shifts of that nature would influence how the bank approaches the choice of its next chief executive, the sources added.
For now, the combination of an unresolved successor picture and the pending regulatory overhaul has made it likely that Ermotti could remain in place longer than he initially signalled, giving UBS time to resolve both internal leadership readiness and the external regulatory environment before making a change at the top.