UBS Group AG and Credit Suisse Group AG in Talks for Potential Merger
UBS Group AG and Credit Suisse Group AG are in talks for a potential merger which could be the most significant banking merger in Europe since the 2008 Great Recession. According to people familiar with the matter, UBS is considering whether to acquire all or part of Credit Suisse, with one likely scenario involving UBS acquiring Credit Suisse to obtain its wealth and asset management units, while possibly divesting the investment banking division.
The two banks are opposed to a forced combination, even as scenario planning for a government-orchestrated tie-up continues. This sentiment was further confirmed by BlackRock, a US investment giant, which denied that it is participating in any plans to acquire all or any part of Credit Suisse.
The Financial Times reported that Swiss regulators regard a merger deal with UBS as the only option to arrest a collapse in confidence in Credit Suisse. The boards at both banks are expected to meet separately this weekend to weigh the idea, with talks orchestrated by the Swiss National Bank and regulator Finma, according to the Financial Times.
Since its inception in 1856, Credit Suisse has been subject to numerous crises, scandals, shifts in management, and legal issues in recent times. The company has been in the midst of a massive strategic overhaul aimed at restoring stability and profitability. It is possible that other solutions are being considered, such as breaking Credit Suisse's business into more divisions or going public with the domestic business while selling the wealth management and asset management divisions to UBS or another interested party.
UBS and Credit Suisse declined to comment, while Finma and the Bank of England did not immediately respond to requests for comment. With the boards at the two banks meeting this weekend, it remains to be seen which route the banks take and whether the merger will go ahead.
0. “UBS said to be in talks to take over embattled lender Credit Suisse (NYSE:CS)” Seeking Alpha, 17 Mar. 2023, https://seekingalpha.com/news/3948655-ubs-said-to-be-in-talks-to-take-over-embattled-lender-credit-suisse
1. “BlackRock Not Working on Rival Bid for Credit Suisse” Bloomberg, 18 Mar. 2023, https://www.bloomberg.com/news/articles/2023-03-18/blackrock-not-working-on-rival-bid-for-credit-suisse
2. “Credit Suisse-UBS Combination Is Regulators' ‘Plan A,' FT Says” Bloomberg, 17 Mar. 2023, https://www.bloomberg.com/news/articles/2023-03-17/credit-suisse-ubs-combination-is-regulators-plan-a-ft-says
3. “UBS In Talks To Acquire Crisis-Hit Swiss Bank Credit Suisse: Report” NDTV, 18 Mar. 2023, https://www.ndtv.com/world-news/ubs-to-explore-credit-suisse-deal-in-crisis-combination-report-3871538
4. “UBS and Credit Suisse Considering Possible Merger” finews.com, 18 Mar. 2023, https://www.finews.com/news/english-news/56305-ubs-credit-suisse-merger
5. “UBS in talks about a deal for troubled Credit Suisse, FT reports” Business Insider, 18 Mar. 2023, https://www.businessinsider.com/ubs-in-talks-acquire-credit-suisse-bank-report-2023-3