Credit Suisse, Ubs studying dossier for acquisition

For the Financial Times, the boards of directors of the two banks will meet separately

The Swiss banking giant UBS has started negotiations to acquire all or part of the second largest Swiss bank, Credit Suisse, which is struggling with a liquidity and credibility crisis that has seriously compromised its position on the markets: writes the Financial Times explaining that the boards of directors of the two largest Swiss lenders will meet separately over the weekend to consider a deal that would represent the largest bank merger in Europe since the financial crisis.

Citing people familiar with the talks, the newspaper reported the moves of the Swiss National Bank and the regulatory authority Finma that would follow the talks in an attempt to boost confidence in the Swiss banking sector: in recent days the central bank had announced a credit line of emergency of 50 billion francs to Credit Suisse, but the move failed to halt the collapse of the institution’s share value, which fell to historic lows. UBS has a market value of $56.6 billion, while shares of Credit Suisse closed Friday with a value of $8 billion.

Swiss regulators – explains the Financial Times – have told their US and UK counterparts that the merger of the two banks was their “plan A” to arrest the collapse of confidence in Credit Suisse, even though UBS is reportedly assessing the potential risks that a agreement could result in your business. The goal of the Bern central bank is to be able to arrive at a simple solution before the markets open on Monday morning.