UBS buys Credit Suisse in all-share transaction

UBS Group AG agreed to buy Credit Suisse Group AG in a government-brokered deal aimed at containing a crisis of confidence that threatened to spread across global financial markets.

Under the terms of the all-share transaction, Credit Suisse shareholders will receive one UBS share for every 22.48 Credit Suisse shares held, equivalent to CHF0.76/share for a total consideration of CHF3 billion, UBS said in a statement on Sunday. The deal will create a global wealth manager with $5 trillion of invested assets across the group.

Both banks have unrestricted access to the Swiss National Bank existing facilities, through which they can obtain liquidity from the SNB in accordance with the guidelines on monetary policy instruments.

Federal Reserve Board Chair Jerome Powell and Treasury Secretary Janet Yellen said Sunday that they welcome the Swiss announcement.

“The capital and liquidity positions of the U.S. banking system are strong, and the U.S. financial system is resilient. We have been in close contact with our international counterparts to support their implementation,” Powell and Yellen said in a statement.