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May 19, 2024 2:40 pm

Crunch weekend for crisis-hit Credit Suisse

It was a crunch weekend for crisis-hit Credit Suisse, Switzerland’s largest bank, as reports emerged that UBS was negotiating to buy all or part of Credit Suisse, with the blessing of the Swiss regulatory authorities.

According to the Financial Times, the Swiss National Bank (SNB) was putting pressure on the two banks to reach a solution before markets opened on Monday. The SNB was said to be seeking a “simple and straightforward solution” to address the ongoing crisis at Credit Suisse, which has been hit by a series of scandals and losses in recent years.

The negotiations between UBS and Credit Suisse came after Credit Suisse announced significant losses related to its exposure to Archegos Capital, a US-based hedge fund that collapsed in March. The bank also faced a scandal involving its involvement in Greensill Capital, a UK-based finance company that went bankrupt earlier this year.

The crisis has prompted calls for changes at the top of Credit Suisse, with shareholders and analysts alike demanding that the bank take swift action to address its problems. The potential acquisition by UBS could provide a way out for Credit Suisse, allowing it to offload some of its troubled assets and refocus its business.

However, there was no guarantee that a deal would be reached between the two banks. While the Swiss regulatory authorities were said to be supportive of the negotiations, UBS may not be willing to take on the risk associated with Credit Suisse’s troubled assets.

The news of the potential acquisition sent shockwaves through the Swiss banking sector, with many analysts and investors watching closely to see how the situation would unfold. Some analysts suggested that a merger between UBS and Credit Suisse could create a stronger and more stable banking giant, while others warned of potential risks associated with such a move.

As the negotiations continued over the weekend, many in the banking sector were left wondering what the future would hold for Credit Suisse and UBS. With markets set to open on Monday, the pressure was on to reach a solution that would satisfy regulators, shareholders, and the public alike.

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