UBS to Buy Credit Suisse for $3.1 Billion as Banking Crisis Continues
UBS, Switzerland’s biggest bank, has agreed to buy its rival Credit Suisse in an emergency rescue deal.
The Details: The Swiss government authorized the roughly $3.1 billion purchase on Sunday, saying it would "secure financial stability and protect the Swiss economy." Credit Suisse, the second-largest bank in Switzerland, announced last week that it would borrow up to 50 billion Swiss francs ($53.68 billion in U.S. dollars) from the Swiss National Bank to quell customer fears after its largest investor, Saudi National Bank, said it didn't plan to increase its nearly 10% investment.
For Context: UBS's purchase is aimed at easing financial market panic after two American banks, Silicon Valley Bank and Signature Bank, failed earlier this month. Central banks around the world have raised interest rates and taken other actions to combat high inflation over the last year, hurting the confidence of investors and borrowers. The international Financial Stability Board had designated Credit Suisse as one of 30 "systematically important" global financial institutions considered "too big to fail." Meanwhile, the Wall Street Journal (Center bias) said Credit Suisse "has long been viewed as the problem child of the banking system."
How the Media Covered It: Left- and center-rated sources covered the deal as a top story Monday. Some moved to draw distinctions between Credit Suisse's failure and Silicon Valley Bank's demise. The homepages of finance-focused sources, from Fox Business to CNN Business, described the story as the latest development in the "banking crisis."
Featured Coverage of this Story
From the LeftUBS is buying Credit Suisse in bid to halt banking crisis
Switzerland’s biggest bank, UBS, has agreed to buy its ailing rival Credit Suisse in an emergency rescue deal aimed at stemming financial market panic unleashed by the failure of two American banks earlier this month.
“UBS today announced the takeover of Credit Suisse,” the Swiss National Bank said in a statement Sunday. It said the rescue would “secure financial stability and protect the Swiss economy.”
UBS is paying 3 billion Swiss francs ($3.25 billion) for Credit Suisse, about 60% less than the bank was worth when markets closed on Friday. Credit Suisse...
From the RightUBS reaches agreement to buy Credit Suisse after upping offer: report
The Swiss government is reportedly set to announce a deal Sunday that will allow UBS, the largest bank in Switzerland, to buy its beleaguered rival, Credit Suisse, for $2 billion, according to the Financial Times.
The announcement comes amid mounting concerns over the potential collapse of Credit Suisse creating a contagion in the banking sector. Credit Suisse saw its stock price plunge and deposit outflows continue last week despite receiving a $54 billion financial lifeline from the Swiss National Bank to bolster its liquidity. The deal was first reported by the Financial Times....
From the CenterUBS shares slide 5%, Credit Suisse craters 60% after takeover deal
Shares of Credit Suisse and UBS led losses on the pan-European Stoxx 600 index on Monday morning, shortly after the latter secured a 3 billion Swiss franc ($3.2 billion) “emergency rescue” of its embattled domestic rival.
Credit Suisse shares collapsed by 60% at around 11:20 a.m. London time (7:20 a.m. ET), while UBS traded 5% lower.
Europe’s banking index was down nearly 1.8% around the same time, with lenders including ING, Societe Generale and Barclays all falling over 2.7%.
The declines come shortly after UBS agreed to buy Credit Suisse as part of a cut-price deal in an effort to stem...
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