UBS said on Monday (Jun 5) it expected to complete its takeover of Credit Suisse “as early as Jun 12”, creating a giant Swiss bank with a balance sheet of US$1.6 trillion following a government-backed rescue earlier this year.

Completion is subject to the registration statement, which covers shares to be delivered, being declared effective by the US Securities and Exchange Commission, and other remaining closing conditions, it added.

“UBS expects to complete the acquisition of Credit Suisse as early as Jun 12, 2023. At that time, Credit Suisse Group will be merged into UBS Group,” UBS said in a statement.

Switzerland’s No 1 bank agreed on Mar 19 to pay 3 billion Swiss francs (S$4.45 billion) and assume up to five billion francs in losses for its smaller Swiss rival after a collapse in customer confidence brought it to the brink of collapse, prompting the Swiss authorities to act to stave off a broader banking crisis. Upon completion, Credit Suisse shares and American Depositary Shares (ADS) will be delisted from the SIX Swiss Exchange (SIX) and the New York Stock Exchange (NYSE), UBS added. SIX said in a separate statement Credit Suisse shares would be delisted on Jun 13 at the earliest.

Under the all-share takeover, Credit Suisse shareholders will receive one UBS share for every 22.48 shares they held.

The biggest bank deal since the global financial crisis will create a group overseeing US$5 trillion of assets, giving UBS overnight a leading position in key markets it would otherwise need years to grow in size and reach.

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The mega-bank will employ 120,000 worldwide, although it has already announced it will be cutting jobs to take advantage of synergies and reduce costs.

UBS had been rushing to close the transaction in record time, hoping to provide greater certainty for Credit Suisse clients and employees, and to stave off departures.

The deal was backed by 200 billion francs in liquidity support from the Swiss central bank as well as the government’s commitment to swallow up to 9 billion francs in losses on top of those borne by UBS.

“We have to be also clear ... this is an acquisition not a merger,” UBS CEO Sergio Ermotti told a financial conference on Friday, warning of “painful” cost and job cuts to come.

A question mark remains over what UBS will do with the Swiss retail bank of Credit Suisse, long seen as the group’s “crown jewel”.

Bringing it into UBS’s fold and combining the two banks’ largely overlapping networks could produce significant savings.

But there has been public pressure to preserve Credit Suisse’s domestic business as a separate entity with its own brand, identity and, critically, workforce.

The bank was still analysing the situation, Ermotti said on Friday, although the “base scenario” remained a full integration with UBS and he would not be swayed by “nostalgia” when deciding how to proceed.

The executive, who was brought back to UBS to steer the takeover, rejected concerns the new bank would be too big for Switzerland, saying although scale was important for banks, smaller institutions could also cause problems.

Overall, Ermotti was optimistic about the challenges ahead.

“I am convinced this is going to be a great story not only for our shareholders and employees but also for our clients and for the financial services industry in Switzerland,” he said on Friday. REUTERS