UBS commits to substantial presence in Stamford
STAMFORD — Gov. Dannel P. Malloy and UBS Group Americas put an end to months of rumors about the financial giant abandoning its Stamford headquarters, announcing Tuesday that it would maintain its gigantic trading floor in the city. It will receive a $20 million, 5-year forgivable loan from the state.
Malloy’s announcement with the company’s chief executive officer, Philip J. Lofts, said UBS will make “minor staff relocations” between Stamford and New York, but the loss of any jobs will be blunted by assuaging fears in recent months that the company would abandon its leased quarters for Manhattan.
The deal announced Tuesday commits the company to keeping at least 2,000 employees in the state, though it was unclear how many would remain in Stamford. The company currently has about 3,500 employees in the state, but Lofts said the company does not disclose how many work at each site.
Lofts said the company had conducted a review of its locations in Connecticut, New York and New Jersey, and said that Malloy has consistently emphasized the significant role UBS plays in the state.
“This recognition, as well as the benefits that accrue to that presence, were significant factors in our decision making process,” Lofts said during a press conference in the lobby of the Stamford headquarters.
Malloy said economic modeling showed that losing 2,000 jobs at UBS would lead to a loss of $70 million in revenue in Connecticut, making the state’s $20 million economic-development package a reasonable investment.
UBS will be eligible for up to $7 million more in forgivable loans if it creates additional jobs. Additional loans would be based on increments of 250 jobs.
Department of Economic and Community Development Commissioner Catherine H. Smith said the loan would be forgiven after 5 years if the company meets requirements for employing at least 2,000 people in Connecticut and spending on infrastructure, technology and job training.
Smith said the gap between the size of the company’s existing Connecticut workforce and the target in the agreement is consistent with previous deals between the state and the company. “They brought jobs to Connecticut well above what their requirement was,” she said.
Malloy noted that New Jersey recently made a similar deal with UBS, and said he thinks Connecticut’s compares well to it. According to news accounts, New Jersey last month gave the company a $27 million tax break to keep 2,000 employees in the state. The Record of Hackensack reported that UBS had said it was considering moving employees to other states, including Connecticut.
Malloy said that discussions about UBS potentially withdrawing completely from Stamford, his hometown, began before he was elected, although they only became public afterward. He said he had discussions with UBS officials as a candidate for governor and continued to visit the site after being elected.
Stamford Mayor Michael A. Pavia attended the announcement and issued a statement noting that city officials had reached out to UBS CEO Oswald Grubel and local executives during the process. Pavia said the company’s impact on the city’s economy and community “cannot be overstated,” and that UBS’ “recommitting” to Stamford “speaks to our City’s ability to attract and retain the best and brightest, its role as a key financial center in the United States and the value proposition it offers for all employers and their employees.”
“Mayor, in Stamford you can take credit,” Malloy told Pavia, his successor as mayor and a Republican, during the announcement. He added: I’ll take credit in the other 168 municipalities.
UBS’s commitment to Stamford preceded Malloy’s tenure as mayor, but it expanded its presence during his administration, which ran from 1995 to 2009. UBS made the city its Americas headquarters in 1997, and in 2002 it completed the largest securities trading floor in the world–103,000 square feet, big enough for 1,400 people–there, along with space for some 4,000 employees.
The company has disputed news accounts of a potential move, and Malloy in June dismissed the talk of UBS leaving Stamford as rumors.
The Stamford Advocate reported in May that an undated internal memo from the company’s co-head of global equities said that the company was looking to consolidate business groups and make “a limited number of changes to staff locations” over the summer.
In June, Bloomberg News reported that UBS was in talks over space in one of the towers being built on the World Trade Center site, and might move its Stamford staff there by 2015. More recent reports suggested that talks over the World Trade Center site were off.
Based in Switzerland, UBS has more than 65,000 employees worldwide. On Tuesday, the company announced plans to reduce costs, including by cutting approximately 3,500 jobs worldwide and “further real estate rationalization.”
Sign up for CT Mirror's free daily news summary.
Free to Read. Not Free to Produce.
The Connecticut Mirror is a nonprofit newsroom. 90% of our revenue comes from people like you. If you value our reporting please consider making a donation. You'll enjoy reading CT Mirror even more knowing you helped make it happen.YES, I'LL DONATE TODAY