UBS in talks with Swiss authorities over Credit Suisse deal protections

UBS in talks with Swiss authorities over Credit Suisse deal protections

May 23 (Reuters) – UBS Group AG (UBSG.S) said on Tuesday it was negotiating with Swiss authorities over loss protections related to its takeover of Credit Suisse Group AG (CSGN.S) and its demands capital regulations.

The disclosure underscores how aspects of the merger between the two banks, hastily arranged over a weekend in mid-March by the Swiss government to avert a wider banking crisis, still need to be ironed out.

The Swiss government agreed at the time to assume up to 9 billion Swiss francs ($10.12 billion) of potential losses from the deal and offered cash assistance of up to 100 billion Swiss francs. .

However, a definitive loss protection agreement remains under negotiation, UBS said in a U.S. regulatory filing on Tuesday.

UBS said in the filing that it expects key terms of the loss protection agreement to be agreed before the Credit Suisse acquisition is completed.

The bank said it was also in talks with Swiss regulator FINMA about “certain prudential capital requirements, measures of risk-weighted assets and other capital and liquidity requirements. for the combined business,” but did not expect these to be finalized before the deal closed.

UBS said it plans to complete the acquisition of Credit Suisse, which nearly collapsed in March following a series of financial scandals and mismanagement, by early June.

($1 = 0.8889 Swiss francs)

Reporting by Manya Saini in Bangalore

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