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Open questions in connection with the takeover of Credit Suisse by UBS
On the evening of 19 March 2023, the Federal Council, accompanied by representatives of the Swiss National Bank and the Swiss Financial Market Supervisory Authority (FINMA), as well as the respective chairmen of the boards of directors of UBS and Credit Suisse, announced the takeover of Credit Suisse by UBS in the form of a statutory merger of the two entities, with a merger ratio of 22.48 Credit Suisse shares to 1 UBS share.
The Federal Council has taken two important decisions under emergency law (Art. 184 para. 3 and Art. 185 para. 3 of the Swiss Constitution), which deviate from existing federal law. The first, which has been widely publicized, is the suppression of the rights of the shareholders of Credit Suisse and UBS to approve the merger. The second, which initially went unnoticed, is the full write-off of additional equity capital (AT1) of Credit Suisse in the amount of 16 billion Swiss francs.
These decisions, along with other measures to stabilize the markets, were published in the Official Compilation of Swiss Laws on 20 March 2023 in a so-called Ordinance on additional liquidity assistance loans and the provision of default risk guarantees by the Confederation for liquidity assistance loans from the Swiss National Bank to systemically important banks (hereinafter the CS-UBS Ordinance), and an explanatory report was published by the Federal Council.
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Open questions in connection with the takeover of Credit Suisse by UBS
On the evening of 19 March 2023, the Federal Council, accompanied by representatives of the Swiss National Bank and the Swiss Financial Market Supervisory Authority (FINMA), as well as the respective chairmen of the boards of directors of UBS and Credit Suisse, announced the takeover of Credit Suisse by UBS in the form of a statutory merger of the two entities, with a merger ratio of 22.48 Credit Suisse shares to 1 UBS share.
The Federal Council has taken two important decisions under emergency law (Art. 184 para. 3 and Art. 185 para. 3 of the Swiss Constitution), which deviate from existing federal law. The first, which has been widely publicized, is the suppression of the rights of the shareholders of Credit Suisse and UBS to approve the merger. The second, which initially went unnoticed, is the full write-off of additional equity capital (AT1) of Credit Suisse in the amount of 16 billion Swiss francs.
These decisions, along with other measures to stabilize the markets, were published in the Official Compilation of Swiss Laws on 20 March 2023 in a so-called Ordinance on additional liquidity assistance loans and the provision of default risk guarantees by the Confederation for liquidity assistance loans from the Swiss National Bank to systemically important banks (hereinafter the CS-UBS Ordinance), and an explanatory report was published by the Federal Council.