UBS aims to avoid using $10bn Credit Suisse backstop amid backlash

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UBS is aiming to make clear next month that its rescue of Credit Suisse will not rely on funding from Swiss taxpayers, as the political backlash against the deal builds ahead of national elections later this year.

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03 Jul 2023

As part of the takeover, the Swiss government agreed to shield UBS from up to SFr9bn ($10bn) in any losses from the deal, provided the bank bore the first SFr5bn.

The scale of potential state support for the shotgun marriage of the country’s two biggest banks has proved politically explosive and continues to draw criticism in the run-up to national elections in October.

UBS executives are hoping to announce that the bank will not call on the government backstop when it publishes its second-quarter results on August 31, according to two people familiar with the matter.

A third person familiar with the matter said a decision not to draw on taxpayers’ money, which still needs to be finalised, would be driven by the business case for doing so rather than any political considerations.

Since the takeover was struck over a