- UBS has completed the legal takeover of its former Swiss rival Credit Suisse.
- The $3.2 billion deal was agreed in March amid fears of Credit Suisse losses that would destabilize the banking system.
- The expanded UBS will have a balance sheet of $1.6 trillion and employ 120,000 people.
UBS expects to complete its acquisition of Credit Suisse “as early as June 12,” creating a giant Swiss bank with a $1.6 trillion balance sheet.
Fabrice Coffrini | Afp | Getty Images
Swiss bank UBS announced on Monday that it had officially completed the acquisition of its rival Credit Suisse.
In an open letter, UBS Chairman Colm Kelleher and newly returning CEO Sergio Ermotti said: “We will combine the collective expertise, scale and wealth management leadership of UBS and Credit Suisse to create an even stronger combined company.”
The letter goes on to say that there will be both “challenges” and “great opportunities” as the bank commits “not to compromise on UBS’s strong culture, conservative risk approach or quality service.”
UBS approved the $3.2 billion deal in March, with Swiss regulators playing a key role in the takeover amid fears that heavy losses at Credit Suisse would destabilize the banking system.
The expanded UBS will have a balance sheet of $1.6 trillion and employ 120,000 people.
Regulators said on Friday they would cover losses of up to 9 billion Swiss francs ($10 billion) after UBS would suffer the first 5 billion Swiss francs under the deal as it raises a portfolio that isn’t quite “matches their business and risk profile”. .”
Post-merger, Credit Suisse and its American Depositary Shares will be delisted from the SIX Swiss Exchange and the New York Stock Exchange, with shareholders receiving one UBS share for every 22.48 Credit Suisse shares held.
The takeover, which followed multiple scandals and years of share price declines at Credit Suisse, resulted in a controversial loss of 16 billion Swiss francs ($17 billion) in assets of the bank’s AT1 bondholders.