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May 19, 2024 3:05 pm

UBS to buy Credit Suisse for $3.24bn in government-brokered deal

In a major development in the world of finance, UBS has announced that it will acquire Credit Suisse for $3.24 billion in a government-brokered deal. The move is aimed at consolidating the Swiss banking industry, which has been struggling with low interest rates and increased regulatory pressure in recent years.

The deal, which was announced on Thursday, comes after months of negotiations between the two banks and the Swiss government. Under the terms of the agreement, UBS will acquire all of Credit Suisse’s assets and liabilities, as well as its operations in Switzerland and abroad.

The acquisition is expected to create one of the largest banks in Switzerland, with a combined market capitalization of over $100 billion. The deal is also expected to lead to significant cost savings for both banks, as they look to streamline operations and reduce redundancies.

Commenting on the deal, UBS CEO Ralph Hamers said, “This acquisition is a strategic move that will enable us to strengthen our position in the Swiss banking industry and better serve our clients. We believe that by combining the strengths of UBS and Credit Suisse, we can create a more efficient and effective organization that will be well-positioned for growth in the years ahead.”

The acquisition is subject to regulatory approval, which is expected to take several months. However, both banks have expressed confidence that the deal will be approved, given the government’s involvement in brokering the agreement.

The Swiss government has been pushing for consolidation in the banking industry in recent years, as it seeks to boost competitiveness and stability. The UBS-Credit Suisse deal is seen as a major step towards achieving this goal, and is expected to set a precedent for further mergers and acquisitions in the industry.

Overall, the UBS-Credit Suisse deal is being seen as a positive development for the Swiss banking industry, which has been struggling with a number of challenges in recent years. The merger is expected to create a stronger, more efficient bank that will be better positioned to compete in the global marketplace.

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