Credit Suisse bank: UBS is reportedly in takeover talks with its struggling rival

  • Author: Kathryn Armstrong
  • BBC news

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Credit Suisse has faced a series of scandals in recent years, including accusations of money laundering

Switzerland’s largest bank UBS is said to be in advanced talks to buy all or part of its troubled rival Credit Suisse.

Shares in Credit Suisse have fallen sharply in recent days after it said it had found a “material weakness” in its financial reporting.

A $54bn (£44.5bn) emergency bailout from the Swiss National Bank has not solved the problem.

Regulators are trying to ease trading before markets reopen on Monday.

There are concerns that Credit Suisse shares would continue their slide after they fell 24 percent on Wednesday.

This caused a general sell-off in European markets and fears of a wider financial crisis.

The Swiss government held an emergency meeting on Saturday night, but so far there has been no official statement on the progress of the negotiations.

UBS has reportedly asked the Swiss government to cover costs of around $6 billion (£4.9 billion) if it were to buy Credit Suisse, according to sources cited by Reuters.

Any deal could also lead to significant job losses.

The problems have coincided with the failure of two US lenders – Silicon Valley Bank and Signature Bank – which raised fears about the health of the banking system.

Founded in 1856, Credit Suisse has faced a series of scandals in recent years, including accusations of money laundering.

It reported a loss of 7.3 billion Swiss francs ($7.9 billion; £6.5 billion) in 2022 – its worst year since the 2008 financial crisis – and has warned that it does not expect to break even until 2024.

However, UBS made a profit of $7.6 billion in 2022.

In addition to being a domestic bank with 95 branches, Credit Suisse operates globally in investment banking and manages the wealth of wealthy clients.

It is one of 30 banks in the world that are considered too big to fail because they are so important to the international banking system.

At the end of last year, Credit Suisse employed 50,480 people worldwide, including 16,700 in Switzerland, although 9,000 jobs had to be cut, Swiss broadcaster SRF reported.

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