UBS to take over Credit Suisse, assume up to 5 billion Swiss francs in losses

The deal includes 100 billion Swiss francs in liquidity assistance for UBS and Credit Suisse from the Swiss central bank.

To enable UBS to take over Credit Suisse, the federal government is providing a loss guarantee of a maximum of 9 billion Swiss francs for a clearly defined part of the portfolio, the government said. This will be activated if losses are actually incurred on this portfolio. In that eventuality, UBS would assume the first 5 billion francs, the federal government the next 9 billion francs, and UBS would assume any further losses, the government said.

Switzerland’s regulator FINMA said that there was a risk that Credit Suisse could have become “illiquid, even if it remained solvent, and it was necessary for the authorities to take action.” Credit Suisse Additional Tier 1 shares with a nominal value of around 16 billion francs will be written down completely after the Swiss government provided support for UBS’ takeover of Credit Suisse, FINMA said.

Finance Finance Latest News, Finance Finance Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

UBS makes offer for Credit Suisse; bondholder losses consideredBloomberg News reports that Credit Suisse is resisting UBS' offer of up to $1 billion. Any deal for Credit Suisse could ripple through global financial markets.
Source: rapplerdotcom - 🏆 4. / 86 Read more »

UBS agrees to buy Credit Suisse for more than $2 billion —FTUBS has agreed to buy Swiss banking giant Credit Suisse after increasing its offer to more than $2 billion, the Financial Times reported on Sunday, as authorities bid to stave off turmoil when the markets reopen.
Source: gmanews - 🏆 11. / 68 Read more »