Swiss finance minister says there are no obstacles for UBS and Credit Suisse – Cryptopolitan

Swiss Finance Minister Karin Keller-Sutter has confirmed that UBS’s multi-billion state-sponsored takeover of Credit Suisse should proceed smoothly without any political obstructions.

Credit Suisse’s rescue

In an interview with the newspaper, Finanz und Wirtschaft, published on Saturday, Keller-Sutter stated that she does not see any stumbling blocks at the moment.

The Swiss parliament is due to hold an extraordinary session next week to discuss the emergency merger engineered by Swiss authorities after Credit Suisse came close to collapse.

UBS and Credit Suisse will create a combined bank with $1.6 trillion in assets – double the size of the entire Swiss economy – and more than 120,000 staff.

Keller-Sutter emphasized that completing the merger is the highest priority, and the government’s intervention last month, which critics have said came too late and promised too much taxpayer support for a bank that paid out billions in bonuses to executives, was aimed at ensuring the stability of the Swiss economy and the Swiss financial center and to prevent an international financial crisis.

The primary goal of the Federal Council was to ensure the stability of the Swiss economy and the Swiss financial center and to prevent an international financial crisis. Under the circumstances, it was and is the best possible choice, which also places the least burden on the state and the taxpayer.

Karin Keller-Sutter

Keller-Sutter criticized the culture at Credit Suisse, which she said had set the wrong incentives and had not learned from previous scandals and prosecutions. She also defended the writedown of AT1 bonds to zero, a controversial part of the rescue. “These are high-risk bonds with high yields, sometimes over 9%,” Keller-Sutter said. “The prospectus for these bonds makes it clear that if a company claims indirect government aid, they can be written off.”

UBS’s Chief Executive Sergio Ermotti has told Credit Suisse staff it is “critical” to remain focused on clients and keeping the business running as the merger of the two banks proceeds, according to an internal memo seen by Reuters.

“We cannot let ourselves get overly distracted by the integration efforts,” Ermotti said in the memo. “It’s critical for us to remain focused on supporting our clients and maintaining operational excellence.”

Parliament’s special session

The special parliamentary session next week was important, she added, and a welcome opportunity to get to the truth of the Credit Suisse debacle.

Keller-Sutter also commented that UBS will have to hold more equity after the takeover, which will rather force them to shrink, and that the risks to the taxpayer were also acceptable – even though the government could assume up to 9 billion francs in losses incurred by UBS by the takeover.

Sergio Ermotti has also tried to calm the nerves of anxious employees worried about massive layoffs and upheaval ahead. In his first communication to Credit Suisse staff after taking over as UBS CEO, Ermotti said there would be “change and hard decisions” ahead.

Still, he tried to reassure them by emphasizing that it is critical for UBS to remain focused on supporting their clients and maintaining operational excellence during the merger process.