Credit Suisse is in a deep crisis. A rescue solution is being sought. One option is a takeover by UBS – it would be the most significant bank merger in Europe since the financial crisis.
The future of the ailing major Swiss bank Credit Suisse remains uncertain. The government met for the crisis meeting on Saturday evening without commenting specifically on any decisions afterwards.
In the room is a complete or partial takeover of the second largest Swiss bank by the largest Swiss bank UBS. A spokeswoman for Credit Suisse and a spokesman for UBS said on Sunday that there was no further comment from their side.
According to media reports, the Swiss supervisory authorities are urging UBS to take over its smaller local rival. State guarantees are a prerequisite for a deal that will be frantically negotiated over the weekend. The Swiss government in Bern should issue a guarantee to cover the risks associated with the takeover, it said. A takeover of Credit Suisse by UBS would be the most significant banking merger in Europe since the financial crisis.
The downward trend in the share price only temporarily stopped
Credit Suisse was already battered by scandals and mismanagement when it fell into another downward spiral after the collapse of the US bank Silicon Valley Bank (SVB). It received a loan commitment from the Swiss National Bank of CHF 50 billion (almost EUR 51 billion), but was only able to stop the downward trend in the share price temporarily.
The government in Bern is under considerable pressure to stabilize the situation. Because Credit Suisse is one of the 30 global systemically important banks whose failure would shake the international financial system.
The Swiss newspaper “Tages-Anzeiger” sees the takeover of the bank by UBS as the only way out. Customer trust is completely gone, and the outflow of money is immense. Several international banks have restricted their business with Credit Suisse. The loan of CHF 50 billion from the National Bank is of no use either. “Everyone is afraid of collapsing,” said the paper.