Swiss leaders are holding a news conference Sunday night following several media reports that banking giant UBS is believed to be in talks to acquire its smaller rival Credit Suisse in an effort to avoid further market-shaking turmoil in global banking.
The Federal Council, the seven-member governing body that includes Swiss President Alain Berset, is expected to announce that UBS is acquiring Credit Suisse in a potential deal brokered by the Swiss government.
The 167-year-old Credit Suisse already received a $50 billion loan from the Swiss National Bank, which briefly caused a rally in the bank’s stock price. Yet the move did not appear to be enough to stem an outflow of deposits, according to news reports. On Friday, shares dropped 8% to close at $2 on the Swiss exchange. The stock has seen a long downward slide: It traded at more than 80 francs in 2007.
In the wake of reforms enacted after the 2008 financial crisis, Credit Suisse is also among the 30 financial institutions known as globally systemically important banks, which have stricter scrutiny and higher capital requirements.
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