UBS and the Swiss government sign loss protection agreement over Credit Suisse takeover

UBS and the Swiss authorities announced Friday that they had signed a nonaccomplishment extortion statement which volition travel into effect erstwhile the takeover of Credit Suisse is completed.

The statement volition spot the Swiss authorities screen losses of up to 9 cardinal Swiss francs ($10 billion) pursuing UBS' acquisition of its rival.

"As portion of the agreement, the Swiss authorities guarantees losses of up to CHF 9bn if realized connected a designated portfolio of Credit Suisse non-core assets erstwhile UBS bears the archetypal CHF 5bn of immoderate realized losses," UBS said successful a statement.

"UBS volition negociate these assets successful a prudent and diligent mode and intends to minimize immoderate losses and maximize worth realization connected these assets."

The acquisition of Credit Suisse is expected to instrumentality spot arsenic aboriginal arsenic June 12, UBS said.

It comes aft the Swiss banking rivals agreed a $3.2 cardinal takeover deal successful March amid volatility successful the planetary banking sector, arsenic 3 U.S. banks collapsed astatine the time.

Credit Suisse shares cratered done aboriginal March, with years of scandals, losses and alleged mismanagement coming to a caput erstwhile its largest shareholder, the Saudi National Bank, said it was not capable to supply immoderate much currency to the bank because of regulatory restrictions.

The merger of the 2 banking juggernauts has been arguable successful galore quarters, enraging Credit Suisse shareholders and bondholders arsenic good arsenic raising competition concerns.

UBS Group shares were level astatine 9:22 a.m. London time.