Dan Kitwood
Switzerland’s largest bank UBS (NYSE:UBS) is said to have made an offer to buy the troubled lender Credit Suisse (CS) for up to $1 billion in exchange for its shares, the Financial Times reports.
Appreciated Agreement the country’s second largest private lender with a current market value of $8.6 billion. UBS offered a price of 0.25 Swiss francs, nearly 87% below Credit Suisse’s Friday close of 1.86 Swiss francs.
As of the end of Friday, UBS (UBS) has a market cap of $57.9 billion, while Credit Suisse (CS), saw their shares drop 73% year-on-year, ending the session with a market value of $8.6 billion. Credit Suisse (CS) has lost a third of its value since early March.
The report added that there is no guarantee that an agreement will be reached as UBS has a number of concerns, including a $6 billion request from the Swiss government to cover the potential deal. UBS has also requested a “material adverse change” that would void the deal if its bad debt swaps spike by 100 basis points or more.
Credit Suisse, UBS and the Swiss government declined to comment.
Credit Suisse 167 years old (CS) was caught up in the turmoil caused by the collapse of US lenders Silicon Valley Bank and Signature Bank over the past week.
Credit Suisse (CS) on Thursday borrowed up to 50 billion francs ($54 billion) from the Swiss National Bank.
There are many reports of interest in Credit Suisse from other competitors. Bloomberg reports that Deutsche Bank is considering the possibility of buying some of its assets, while US financial giant BlackRock has denied that it is participating in a rival bid to acquire the bank.
