UBS Nears Deal to Buy Credit Suisse

The Swiss government is close to announcing a deal that would involve UBS buying Credit Suisse, its smaller, beleaguered rival, for about $1 billion, three people with knowledge of the matter said on Sunday.

The takeover of Credit Suisse is the most consequential fallout to date from the turmoil that spread from the implosion of Silicon Valley Bank earlier this month. But Credit Suisse’s troubles were largely of its own making, tied to years of scandals and financial missteps that have cost it billions of dollars in trading losses and legal fines.

Not even a $54 billion lifeline from the Swiss National Bank, announced last week, was able to stem the erosion of investor confidence that sank Credit Suisse’s shares to record lows.

Under the terms of the proposed deal, UBS will pay just a fraction of the roughly 8.8 billion Swiss francs, or $9.5 billion, that Credit Suisse was valued at on Friday, these people said. The Swiss government is expected to allow some financial rules to be bypassed, notably a six-week consultation period with UBS shareholders before any transaction can be approved.

A deal is expected to be announced later on Sunday, though terms could still change and talks may still fall apart, these people cautioned. Details of the proposed transaction were reported earlier by The Financial Times.

The Swiss government is expected to bypass certain regulations that would otherwise have required a six-week consultation period with UBS shareholders before any deal can be approved.

This is a developing story. Check back for updates.

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