Ubs: TCS expects more biz from UBS-Credit Suisse merger – Times of India

BENGALURU: TCS, which counts Credit Suisse as one of its key customers, is anticipating some changes in this business in the medium to long term following the UBS takeover, company COO N Ganapathy Subramaniam told TOI in an interview. However, he said it would be business as usual in the short term.
Sources told TOI that Cognizant, TCS and Wipro have deals with Credit Suisse, amounting collectively to as much as $350-400 million annually. The remaining slice of the outsourcing pie is shared between Infosys, Tech Mahindra and HCL Tech.
“It’s good to assume there will be change. The way the regulators structured the deal (UBS taking over Credit Suisse) has brought in stability. All the existing work that’s being done in countries, in technology and operations, all of that is continuing as business as usual. In two quarters, we will pitch to them (UBS) how they can leverage synergies,” he said. He expects more business from the integration.

In the March quarter, TCS signed $10 billion in total contract value, out of which $3 billion came from banking & financial services. Revenue grew a modest 0.6% in constant currency compared to the preceding quarter, weighed by banking and financial services. “After the SVB (Silicon Valley Bank) collapse, customers became a bit tentative. They want to do projects, but they want to spend wisely. If they don’t do anything in six months, given the pace at which technology changes, they will become a legacy company very quickly. They have deferred a few projects which have impacted our revenue,” he said.
Subramaniam said banks are focusing on cost-optimisation by simplifying the organisation. “The whole approach is to kill reconciliation. In each bank, there are thousands of people doing reconciliation work in the back office. They don’t need them if they optimise using tech. With newer technologies like generative AI, there are opportunities to co-innovate and cocreate,” he added.
Subramaniam said he doesn’t anticipate the chain reaction that was pronounced in the banking and financial services space during the great financial crisis of 2008.
He said the company is giving 15-20% increments for top performers, 10-15% for good performers, and 5-7% for average performers. “Average hikes are 8-12%. We have rolled out hikes effective April 1, and gave 100% variable pay for last quarter,” he said.