Swiss authorities are considering a full or partial nationalization of Credit Suisse Group AG as the only other viable option outside a UBS Group AG takeover, according to people with knowledge of the matter.
The country is considering either taking over the bank in full or holding a significant equity stake if a takeover by UBS Group AG falls apart because of the complexities in arranging the deal and the short time frame involved, the people said, asking not to be identified as the matter is private.
The situation is very fluid and can still change as authorities seek to finalize a solution for the bank by the time Asian markets open, which is late evening in Europe, the people said.
The Swiss finance ministry declined to comment.
There are multiple complexities of a UBS takeover, including thorny issues such as a government backstop that would cover possible legal and other losses. The larger rival has also balked at taking on Credit Suisse’s investment bank, Bloomberg reported on Saturday.
UBS is asking the government to take on certain legal costs and potential future losses in any takeover, said the people, with one report putting the figure at about $6 billion. It’s tabled an offer of about $1 billion for Credit Suisse, which the smaller Swiss bank believes is too low.