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UBS Group (UBS) has agreed to acquire Credit Suisse Group (New York Stock Exchange: CS) in a government-led deal that aims to contain the banking shock taking place in global financial markets, according to a media report.
The longest USB (UBS) will pay more than $2 billion, all in stock, for the smaller Credit Suisse (CS). Bloomberg reported, citing people familiar with the matter. That’s a fraction of Credit Suisse’s market capitalization of ~CHF 7.4B ($8B) at Friday’s close. In the last five yearsCS’s ADSs have plunged 89% as the Swiss bank has battled scandal after scandal.
The plan was quickly put together after the collapses of Silicon Valley Bank and Signature Bank triggered a plunge in Credit Suisse stocks and bonds. Bloomberg saying. The Swiss National Bank’s promise to provide sufficient liquidity to CS apparently failed to assuage investor fears about the bank’s prospects.
The United States has been in contact with their Swiss counterparts, as both banks operate in the United States and are considered systemically important in Switzerland, Bloomberg previously reported.
The authorities were anxious to have a deal before the Asian markets opened up.
More about Credit Suisse (CS):
- Earlier, Credit Suisse (CS) was reported to have opposed a $1B takeover offer from UBS (UBS).
- Credit Suisse shares rose on March 16 after the bank secured a $54 billion loan from the Swiss National Bank.
SA contributor IP Banking Research discusses the implications of a forced wedding between Credit Suisse and UBS.
