UBS Closes Credit Suisse Takeover, Projects CET1 Ratio of 14% in 2023

Author: Lekha Gupta | June 12, 2023 05:32am

UBS Group AG (NYSE:UBS) disclosed completing the acquisition of Credit Suisse Group AG (NYSE:CS) today.

As previously announced on March 19, 2023, CS shareholders will receive 1 UBS share for holding every 22.48 CS shares.

Also, UBS will manage two separate parent banks – UBS AG and Credit Suisse AG, with each organization continuing to operate its subsidiaries and managing its client base.

Today will be the last trading day of CS on the SIX Swiss Exchange, and the combined entity will operate as a consolidated banking group.

UBS stated its Board of Directors and Executive Board would oversee the combined company and disclosed Board of Director nominations for certain Credit Suisse entities.

With the buyout completion, UBS expects its CET1 capital ratio to be around 14% in Q2 2023 and to remain around that level in 2023. 

UBS also projects CS’ operating losses and high restructuring charges to be offset by reduced risk-weighted assets (RWA).

“I‘m pleased that we’ve successfully closed this crucial transaction in less than three months, bringing together two global systemically important banks for the first time. We are now one Swiss global firm and, together, we are stronger. As we start to operate the consolidated banking group, we’ll continue to be guided by the best interests of all our stakeholders, including investors. Our top priority remains the same: to serve our clients with excellence,” said Colm Kelleher, Chairman of UBS.

UBS will now report consolidated financial results for the combined group under IFRS in USD, with Q2 2023 results expected on August 31, 2023.

Last week, UBS inked a loss protection agreement with the Swiss government, which will be effective post-completion of the CS acquisition.

Price Action: UBS shares are trading higher by 0.89% at $20.37 premarket on the last check Monday.

Posted In: CS UBS