The Swiss government plans to nationalize Credit Suisse if talks between UBS Group AG and the troubled bank fail. On this subject writing the economic agency Bloomberg on Sunday.
The decision on the bank’s fate can be made on Monday before trading begins.
According to Bloomberg, UBS is offering to buy Credit Suisse for around 1 billion Swiss francs ($1.1 billion). However, to the shareholders of Credit Suisse, and in the first place to the National Bank of Saudi Arabia (SNB), this amount seems insufficient. According to the agency, Credit Suisse’s market value as of March 17 was $8 billion.
If the two largest Swiss banks do not agree among themselves, the country’s government is considering the option of fully or partially nationalizing Credit Suisse, sources told Bloomberg. At the same time, the agency notes, the Swiss government is ready to undermine the rights of Credit Suisse shareholders, if only to prevent an escalation of the banking crisis.
The situation with Credit Suisse
Credit Suisse’s problems became known in early March. The bank was due to publish its annual report on March 9, but postponed publication after claims by the United States Securities and Exchange Commission. The regulator, in particular, questioned the bank’s free cash flow reports for 2019 and 2020.
On March 15, Credit Suisse’s largest investor, the National Bank of Saudi Arabia (SNB), announced that it would not be able to provide further financial assistance to the Swiss organization. On the same day, March 15, there was the biggest drop in Credit Suisse shares in nearly 170 years of history. There were real fears that the Swiss lender could repeat the fate of Silicon Valley, a US venture capital bank which filed for bankruptcy on March 10 this year.
