‘Crisis of confidence’ leads Credit Suisse to merger with UBS

Credit Suisse will merge with UBS in a move approved by Swiss banking regulators after a proposed cash injection from the Swiss National Bank (SNB) failed to stabilize Credit Suisse’s rapidly declining finances.

UBS, Switzerland’s largest bank, announced Sunday it will purchase the country’s second-largest bank for 3 billion Swiss francs (U.S. $3.2 billion). Credit Suisse shareholders will receive 1 UBS share for every 22.48 Credit Suisse shares held, UBS said. The merger is expected to be completed by the end of the year, Credit Suisse said in a statement.

The deal was approved by the SNB and the Swiss Financial Market Supervisory Authority (FINMA) after Credit Suisse suffered a “crisis of confidence” as depositors raced to withdraw their funds from the bank, the regulators said in a joint statement.