- According to the Financial Times, UBS is in talks to buy some or all of Credit Suisse.
- The negotiations came after a disastrous week for Credit Suisse.
- A merger between the two largest Swiss banks could take place a week after the SVB collapsed.
Two of Switzerland’s largest banks and their regulator have struck a merger deal that Switzerland can respond to quickly. financial times report.
The Swiss National Bank and Swiss regulators brokered negotiations with UBS as the only way to restore confidence in UBS and its smaller rival Credit Suisse. report Friday.
The Times reported late Saturday, citing people familiar with the situation, that the country was ready to take urgent steps to facilitate UBS’s takeover of Credit Suisse. Normally, UBS would have to allow shareholders weeks before such transactions take place, but with emergency measures it can skip that waiting period.
UBS and Credit Suisse declined to comment to the FT and Bloomberg.
Withdrawals from Credit Suisse amounted to about $11 billion a day late this week, hurting confidence, two sources, who asked not to be identified, told the FT.
The boards of both banks are meeting this weekend, suggesting a deal is imminent.but Bloomberg later reported on Saturday The bank’s investment banking and trading divisions are in trouble for both, sources said.
UBS had asked the Swiss government to cover part of the legal costs and other losses if the deal went through, Bloomberg reported, citing unnamed sources. They proposed that UBS buy rival wealth and asset management divisions and sell its investment banking division.
Swiss regulators have told their US and UK counterparts that a merger of UBS and Credit Suisse is their “Plan A,” according to the FT. UBS posted a profit of $7.6 billion last year and is in far better financial health than its smaller rivals, which lost $7.9 billion.
Deutsche Bank is also weighing whether parts of Credit Suisse may appeal and the potential value if split. reported by BloombergBank officials declined to comment to the outlet.
of FT also reports BlackRock was considering an offer to Credit Suisse, but a representative told Insider that it had “no interest” in buying any or all of the Swiss banks.
Talk of the UBS-Credit Suisse partnership comes just a week after the collapse of the Silicon Valley bank sent shockwaves through the banking industry.
Credit Suisse was hit particularly hard by investor concerns. This is because we are facing many other challenges these days. delay 2022 Annual Report after Inquiry from SEC.
Worse, the Zurich-based bank’s largest shareholder, the Saudi National Bank, warned this week that it won’t. can invest Bank more cash without facing regulatory hurdles.
On Thursday, the troubled bank announced it had secured $50 billion after Credit Suisse shares hit record lows. life line From the Swiss Central Bank.
But the stock fell another 8% in Zurich on Friday, slashing the bank’s valuation to around $8.8 billion.
