Switzerland’s biggest bank, UBS, has agreed to buy its rival Credit Suisse in a bid to contain the global financial market panic that sparked soon after two American banks collapsed earlier this month. According to the deal, which was hurriedly brokered by the Swiss government and regulators, UBS will be paying around $3.2 billion to Credit Suisse and the Swiss central bank will give $108 billion in liquidity assistance for both the banks. Meanwhile, the Swiss government said it would provide more than $9 billion to backstop some losses that UBS may incur by taking over Credit Suisse, The Wall Street Journal reported. In a statement issued on Sunday (March 19), UBS Chairman Colm Kelleher said, “Acquiring Credit Suisse’s capabilities in wealth, asset management and Swiss universal banking will augment UBS’s strategy of growing its capital-light businesses. The transaction will bring benefits to clients and create long-term sustainable value for our investors.” History of UBS bank Known for providing private banking, wealth management, asset management, and investment banking services for private, corporate and institutional clients, UBS was established in 1998 when two of Switzerland's biggest banks, the Swiss Bank Corporation and the Union Bank of Switzerland, were joined together. Notably, the name UBS, although it has been derived from “Union Bank of Switzerland”, isn’t an acronym. The Swiss Bank Corporation was originally set up as Basel Bank Corporation in 1854 by six private bankers in Basel in order to provide credit to Swiss railroad and manufacturing companies. In subsequent years, it merged with Zürich Bank Corporation and entered the commercial banking sector. By 1897, the Basel Bank Corporation had consumed two other Swiss banks and changed its name to Swiss Bank Corporation. It went on to acquire several more banks in the following years, opening its branches across Switzerland and other countries. The Union Bank of Switzerland opened up in 1912 after the Bank in Winterthur (1862) was merged with Toggenburger Bank (1863). Much like the Swiss Bank Corporation, the Union Bank of Switzerland also absorbed a host of banks in Switzerland and became one of the biggest banks in the country. Despite the success of both the Swiss Bank Corporation and the Union Bank of Switzerland, they were merged together as they faced intense competition from American banks. Thus, in 1998, UBS Group AG or UBS was born. Today, it is one of the largest banks in the world with a market capitalization of $63 billion, as per a 2022 report. With its headquarter in Zurich, UBS has around 200 branches and 4,600 client advisors in Switzerland alone. It also provides its services in 50 other countries, including India.
