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Swiss prosecutor probes Credit Suisse takeover

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Logos of Swiss bank UBS and Credit Suisse in Zurich, Switzerland March 20, 2023. REUTERS/Denis Balibouse/File Photo

Switzerland’s Federal Prosecutor has opened an investigation into the state-backed takeover of Credit Suisse (CSGN.S) by UBS Group (UBSG.S), the office of the attorney general said on Sunday.

The prosecutor, based in the Swiss capital Bern, is looking into potential breaches of the country’s criminal law by government officials, regulators and executives at the two banks, which agreed on an emergency merger last month to avoid a meltdown in the country’s financial system.

There were “numerous aspects of events around Credit Suisse” that warranted investigation and which needed to be analysed to “identify any criminal offences that could fall within the competence of the [prosecutor]”, it said in a statement.

“The Office of the Attorney General wants to proactively fulfil its mandate and responsibility to contribute to a clean Swiss financial centre and has set up a monitoring system so that it can take action immediately on any issues that fall within its area of responsibility,” it added.

It gave no indication of any specific aspects of the merger agreement it might look into or how long the investigation might last.

Credit Suisse and UBS did not immediately respond to requests for comment.

Last month, UBS said it would acquire rival Credit Suisse for 3 billion Swiss francs ($3.3 billion) in a deal orchestrated by the Swiss government, the central bank and market regulator.

The bank is trying to close the deal by as soon as end April, sources have told Reuters.

A poll of Swiss economists found that nearly half think the takeover of Credit Suisse was not the best solution, and warned that the situation had dented Switzerland’s reputation as a banking centre.

The deal, which was also designed to help secure financial stability globally during a period of turmoil, has sparked concern among critics about the size of the merged bank, with $1.6 trillion in assets and more than 120,000 staff worldwide.

Up to 30% of staff could lose their jobs due to the takeover, according to an unnamed senior UBS manager quoted in Swiss media.

($1 = 0.9148 Swiss francs)

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