The bank UBS is in negotiations to take over all or part of the Swiss creditaccording to information from the Financial Times published this Friday, the 17th. The boards of the two largest banks in Switzerland should meet at the end of the week, separately, to address the issue.
The Swiss National Bank (the Swiss central bank) and the country’s capital markets regulator are behind the talks in an attempt to restore confidence in the country’s banking sector, the sources told the FT. The move comes days after the Swiss central bank granted a CHF50 billion emergency credit line to stem a liquidity crisis at Credit Suisse.
UBS currently has a market value of $56.6 billion. On Friday, shares of Credit Suisse closed at a value of $8 billion.
What can happen if Credit is sold to UBS?
JPMorgan’s Kian Abouhossein predicts that if UBS took over Credit Suisse, it would do an IPO of CS Swiss, close Credit Suisse’s investment bank and retain the asset and wealth management arms.
The analyst says, however, that closing Credit Suisse’s investment bank would entail 9.7 billion Swiss francs in restructuring costs, although it would yield something around 64 billion Swiss francs.
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