Reuters: UBS seeks $6bn government guarantee to buy Credit Suisse
UBS, the largest Swiss financial holding, is seeking government guarantees for $6 billion to acquire the country's second-largest bank, Credit Suisse, sources said. Reuters. Other options are being considered, the amount may change. During the takeover, 10 thousand employees can be reduced.
State guarantees should help UBS cover the costs of curtailing a number of Credit Suisse destinations, as well as cover likely legal costs, the source explained to Reuters. According to him, the parties intend to agree on the issue at the weekend, before the opening of exchange trading. The absorption is complicated by the size of the banks, whose total assets amount to about $1.7 trillion. In this regard, it is possible to sell only part of the divisions of Credit Suisse.
Credit Suisse, UBS and the Swiss government declined to comment.
Credit Suisse has been experiencing serious problems for several years due to a series of high-profile scandals. And the bank ended 2022 with a loss of $7.9 billion, which was the bank's worst result since 2008. The situation for the Swiss bank was exacerbated by the sudden bankruptcy of Silicon Valley Bank and the closure of Signature Bank, which caused massive investor anxiety. On March 13, Credit Suisse said it found "material deficiencies" in its financial statements. This sent the stock down 30%. Against this backdrop, the Swiss National Bank approved the allocation of a loan of approximately 50 billion Swiss francs ($53.7 billion) to Credit Suisse. A possible takeover of Credit Suisse by UBS was previously reported by Bloomberg sources, the parties did not comment on this information.
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