Swiss authorities brokered the controversial emergency rescue of Credit Suisse by UBS for 3 billion Swiss francs ($3.37 billion) over the course of a weekend in March.
Fabrice Coffrini | AFP | Getty Images
The agreement will see the Swiss government cover losses of up to 9 billion Swiss francs ($10 billion) following UBS’ acquisition of its rival.
“As part of the agreement, the Swiss government guarantees losses of up to CHF 9bn if realized on a designated portfolio of Credit Suisse non-core assets once UBS bears the first CHF 5bn of any realized losses,” UBS said in a statement.
“UBS will manage these assets in a prudent and diligent manner and intends to minimize any losses and maximize value realization on these assets.”
The acquisition of Credit Suisse is expected to take place as early as June 12, UBS said.
Credit Suisse shares cratered through early March, with years of scandals, losses and alleged mismanagement coming to a head when its largest shareholder, the Saudi National Bank, said it was not able to provide any more cash to the bank because of regulatory restrictions.
UBS Group shares were flat at 9:22 a.m. London time.