Fri | Jun 2, 2023

Banking giant UBS acquiring Credit Suisse for US$3.2 billion

Published:Sunday | March 19, 2023 | 2:57 PM
The illuminated logo of Swiss bank Credit Suisse is seen behind a clock at the banks headquarters at Paradeplatz in Zurich, Switzerland on Saturday, March 18, 2023. (Michael Buholzer/Keystone via AP)

GENEVA (AP) — Banking giant UBS is buying its smaller rival Credit Suisse for US$3.2 billion in an effort to avoid further market-shaking turmoil in global banking, Swiss President Alain Berset announced on Sunday night.

Berset called the announcement “one of great breadth for the stability of international finance. An uncontrolled collapse of Credit Suisse would lead to incalculable consequences for the country and the international financial system.”

The Swiss Federal Council, a seven-member governing body that includes Berset, passed an emergency ordinance that allows the merger to go through without the approval of shareholders.

Credit Suisse Chairman Axel Lehmann called the deal “a clear turning point.”

“It is a historic, sad and very challenging day for Credit Suisse, for Switzerland and for the global financial markets,” Lehmann said, adding that the focus is now on the future and in particular on the 50,000 Credit Suisse employees, 17,000 of whom are in Switzerland.

Colm Kelleher, the UBS chairman, hailed the “enormous opportunities” that emerge from the takeover, and highlighted his bank's “conservative risk culture” –- a subtle swipe at a Credit Suisse culture that's known for more swashbuckling, riskier gambles on bigger returns. He said the combined group would create a wealth manager with over $5 trillion in total invested assets.

Berset said the council had agreed to guarantee a total of 150 billion francs (US$162 billion) of liquidity to Credit Suisse, well beyond the 50 billion Swiss francs (US$54 billion) figure that had been announced publicly. But that didn't appear to be enough.

“We noted that the outflows of liquidity and the volatility of the markets demonstrated that necessary confidence could no longer be restored, and a rapid solution guaranteeing stability was essential.”

Swiss Finance Minister Karin Keller-Sutter said the council “regrets that the bank, which was once a model institution in Switzerland and part of our strong location, was able to get into this situation at all.”

The combination of the two biggest and best-known Swiss banks, each with storied histories dating back to the mid-19th century, amounts to a thunderclap for Switzerland's reputation as a global financial centre — leaving it on the cusp of having a single national champion in banking.

While UBS is buying Credit Suisse, UBS officials said they plan to sell off parts of Credit Suisse, or reduce the size of the bank over the coming months and years.

The Swiss central bank has agreed to provide a loan of 100 billion Swiss francs (US$108 billion) backed by a federal default guarantee to support the deal, which is expected to be completed by the end of the year.

Follow The Gleaner on Twitter and Instagram @JamaicaGleaner and on Facebook @GleanerJamaica. Send us a message on WhatsApp at 1-876-499-0169 or email us at or