Deal aims to contain a crisis of confidence in global financial markets. Priced at more than $3 billion, all share deal, also priced at fraction of Credit Suisse’s Friday close. Credit Suisse was valued at about 7.4 billion francs ($8 billion) on Friday.
Despite avoiding a bailout amidst the financial crisis, Credit Suisse has faced a barrage of challenges in recent years, including an array of setbacks such as significant legal issues, scandals, changes in leadership, and various other mishaps. This has culminated in an exodus of over $100 billion in assets by clients in the final quarter of last year, with apprehensions regarding its financial stability continuing unabated, even after raising capital of 4 billion francs from shareholders.
The acquisition of the venerable 166-year-old financial institution represents a momentous occurrence in the annals of national and global finance. Originally established by industrialist Alfred Escher in 1856 as Schweizerische Kreditanstalt with the aim of financing Switzerland’s railroad infrastructure, it had evolved into a preeminent global juggernaut, emblematic of Switzerland’s stature as a leading financial hub. Nevertheless, it struggled to adapt to the altered banking terrain post-financial crisis, eventually necessitating its acquisition.
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