Swiss authorities brokered the controversial emergency rescue of Credit Suisse by UBS for 3 billion Swiss francs ($3.37 billion) over the course of a weekend in March.
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UBS and the Swiss government announced Friday that they had signed a loss protection agreement which will come into effect once the takeover of Credit Suisse is completed.
The agreement will see the Swiss government cover losses of up to 9 billion Swiss francs ($10 billion) following UBS’ acquisition of its rival.
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“As part of the agreement, the Swiss government guarantees losses of up to CHF 9bn if realized on a designated portfolio of Credit Suisse non-core assets once UBS bears the first CHF 5bn of any realized losses,” UBS said in a statement.
“UBS will manage these assets in a prudent and diligent manner and intends to minimize any losses and maximize value realization on these assets.”
This is a developing story and will be updated shortly.
