Home » Business » Credit Suisse purchased by UBS for $3.25 billion.

Credit Suisse purchased by UBS for $3.25 billion.

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Moscow. 20th of March. INTERFAX.RU – Swiss bank UBS is buying struggling Credit Suisse for 3 billion Swiss francs ($3.25 billion), MarketWatch reports.

The deal was announced by Swiss President Alain Berset, accompanied by the heads of both banks and the head of the Swiss National Bank (SNB, the country’s central bank).

“Through the takeover of Credit Suisse by UBS, a solution was found to ensure financial stability and protect the Swiss economy in this exceptional situation,” the SNB said in a statement.

UBS will pay 0.76 francs per share to Credit Suisse. The transaction, which does not require shareholder approval, will be paid in full in cash.

At the close of trading on Friday, shares of Credit Suisse were worth 1.86 francs. Initially, UBS offered just 0.25 francs per share of the former competitor, according to the Financial Times.

“We welcome the statements of the Swiss authorities to support financial stability,” US Treasury Secretary Janet Yellen and Federal Reserve Chairman Jerome Powell said in a statement. “The capital and liquidity of the US banking system is strong and the financial system is resilient. We are in close contact with our international partners”.

The President of the European Central Bank, Christine Lagarde, said that the actions taken by the Swiss authorities are “helpful in restoring orderly market conditions and ensuring financial stability.” The eurozone banking sector is resilient thanks to strong capital and liquidity positions, she said.

Saudi National Bank, the Qatar Investment Authority (QIA) and the Norwegian Oil Fund are among the shareholders of Credit Suisse, which may suffer the most serious losses due to the sale of bank shares at a significant discount, writes MarketWatch.

QIA owns 6.8% of Credit Suisse. Saudi National Bank bought a 9.9% stake in the Swiss bank just six months ago for $1.5 billion, now this package is valued at just $215 million.

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