Financial crisis: Swiss bank Credit Suisse sold to competitor for $2 billion to avoid collapse

Negotiations on the rescue of the large Swiss bank Credit Suisse have ended. As FACTS has already reported, its shares fell last week. The Swiss Central Bank has agreed to provide Credit Suisse with an emergency loan of 51 billion euros. However, this did not help the situation.

The Swiss government intervened. He suggested that another large bank, UBS, buy out its main competitor. At first, the management of UBS and Credit Suisse said that such an agreement was impossible, since it was not in the interests of both banks. But negotiations continued at the insistence of the government.

And so, as stated in Bern Swiss President Alain Berset“found the best solution to ensure confidence in the financial system“. UBS buys its competitor for $2 billion. The country’s central bank provided guarantees of up to $9.6 billion to cover possible losses for UBS after the merger.

The Swiss government was keen to complete the talks by Monday so exchanges could start trading amid the good news. The Central Bank said in a statement:A solution has been found that will strengthen financial stability and protect the Swiss economy in this exceptional situation.“.

Recall that Credit Suisse is one of the 30 backbone world banks. It has 167 years of history. However, the last few years have been very unfortunate. The bank suffered losses. Attempts to save the day with shady deals have led to allegations of money laundering.

But allowing such a large bank to collapse would be a mistake, I’m sure. Swiss Finance Minister Karin Keller-Sutter. “The default of a systemically important bank would have unpredictable consequences both at home and abroad” she said.

Recall that Switzerland is destroying intact air defense systems that could have been given to Ukraine.