Credit Suisse and UBS entered into a merger agreement on March 19 following the intervention of the Swiss Federal Department of Finance, SNB and FINMA. UBS will be the surviving entity upon closing of the merger transaction. Under the terms of the merger agreement all shareholders of Credit Suisse will receive 1 share in UBS for 22.48 shares in Credit Suisse.
As part of the rescue package for Credit Suisse as directed by the Swiss National Bank (SNB) and the Swiss Financial Market Authority (FINMA), all of Credit Suisse’s additional tier 1 (AT1) capital of CHF16 billion will be written down completely.
“On Sunday (March 19), Credit Suisse has been informed by FINMA that FINMA has determined that Credit Suisse’s Additional Tier 1 Capital (deriving from the issuance of Tier 1 Capital Notes) in the aggregate nominal amount of approximately CHF16 billion will be written off to zero,” a Credit Suisse press release states.
