Scandal-plagued Credit Suisse has long languished, coming under intense scrutiny during the stock market turmoil that first began with the collapse of the Silicon Valley bank in the US.
In the end, the Swiss bank was acquired by rival UBS in a hasty takeover, which the latter believes it only had four days to execute, albeit with good help from the SNB.
UBS now expects to reach $17 billion post-acquisition, according to the exchange’s announcement Tuesday night. Reproduced by, among others, Reuters. This amounts to more than NOK 180 billion at today’s exchange rate.
According to the news agency, value adjustments make up $13 billion of the total amount, while $4 billion is expected to result in potential legal and regulatory costs related to the purchase.
But on the other hand, UBS expects to make a one-time gain from the reversal of the so-called “negative goodwill” of $34.8 billion by buying Credit Suisse at a fraction of its book value.
Urgent appointment
However, UBS maintains that estimates are preliminary and may change significantly at a later date.
Jefferies analysts have estimated the total cost of the restructuring, legal provisions and planned closure of what is not considered a core business for UBS at $28 billion.
UBS believes that it was rushed to the agreement by the central bank, and states that it has less than four days to complete the necessary investigations.
In March, the bank bought Credit Suisse for over US$3.4 billion in shares in an emergency deal directed by the Swiss authorities. The bailout is the first of its kind since the financial crisis of 2008, and will create a banking giant with invested capital of more than NOK 5 trillion – NOK 5,000 billion.
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