The damaged Credit Suisse is swallowed up by the competition: After difficult negotiations, the credit institution goes to the major bank UBS.
The future of Credit Suisse has been decided: the major bank UBS will take over its competitor. The Swiss National Bank (SNB) is supporting the takeover with liquidity assistance of CHF 100 billion (around EUR 101 billion) to both banks.
This was announced by the Swiss Federal Council and representatives of the two institutes and the supervisory authorities at a press conference on Sunday evening. This was preceded by a marathon of negotiations that lasted the whole weekend, in which the parties involved from the two banks as well as top representatives from politics and the supervisory authorities took part.
Step to stabilize the financial sector
“With the takeover of Credit Suisse by UBS, a solution was found to ensure financial stability and protect the Swiss economy in this extraordinary situation,” the SNB said in a statement. This contributes to the stability of the entire financial sector.
In order to reduce any risks for UBS, the federal government is also issuing a guarantee of CHF 9 billion to cover potential losses. The measures taken will ensure that the SNB can provide Credit Suisse with extensive liquidity if necessary. Finma approved the takeover. Both banks could continue all business activities.
The Swiss government had urged UBS to take over the bank in order to restore confidence in Credit Suisse and prevent the crisis from spreading to other banks in Europe.
