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The value per share in the deal is clearly lower than the final price, and the competitiveness ranking manager questions whether shareholders will approve the arrangement.
“Switzerland will never be the same again.” That blunt remark comes from Arturo Bris, a professor at the International Institute for Management Development, or IMD, a leading business school based in Lausanne, Switzerland. Over the weekend, Bris described the Credit Suisse takeover by UBS as a huge fortune loss, noting that shareholders of the acquired bank will receive 0.76 Swiss francs for each share, down from 1.86 francs at the close on Friday.
Bris adds that Credit Suisse’s largest shareholders are unlikely to accept the deal, and many Swiss pension funds are also invested heavily in the bank. He questions whether the merger will ultimately be beneficial for UBS, arguing that the burdens and risks of the operation would be borne by customers, depositors, and shareholders alike.
He emphasizes that the bailout costs are effectively funded by Swiss taxpayers. The fate of roughly 16,000 employees in the Swiss retail network remains uncertain, especially given the Credit Suisse branch’s proximity to a UBS location, suggesting at least one branch could close. Both banks face potential losses in their asset management units, and Bris predicts a reputational toll for Swiss banks as a whole due to the upheaval and ongoing client departures.
The crisis outcome appears to be a large institution with near monopoly power in certain Swiss markets, a scenario Bris deems undesirable for customers. The financial package includes a liquidity infusion of 100 billion francs, yet additional costs from restructuring and lost business must be considered. Bris acknowledges the quick action by Swiss authorities to avert a broader banking crisis but remains skeptical about the ultimate success of the merger. He warns that large, slow-moving corporate structures rarely deliver the promised results, urging caution as the integration unfolds.
As analysts weigh the implications for the Swiss financial system, the broader picture remains unsettled. The implications for competition, consumer choice, and financial stability will continue to unfold in the coming weeks and months. This situation is closely watched by investors and policymakers alike, who will be assessing not only the immediate financial terms but the longer-term strategic fit and the shared costs borne by the Swiss public and the bank’s stakeholders. In the end, the question stays open: will the combined entity emerge stronger, or will the compromises made during the deal create new vulnerabilities for customers and markets?