UBS Group AG puts an end to the historic acquisition of Credit Suisse! Credit Suisse is deregistered
Although UBS Group AG's acquisition of Credit Suisse incurred huge costs, dragging down performance, and investors doubted the success of the acquisition, UBS Group AG ultimately successfully acquired Credit Suisse. The long-term value and potential benefits brought by this acquisition have begun to emerge, with UBS Group AG returning to profitability this month and exceeding market expectations. Since the acquisition of Credit Suisse, UBS Group AG's stock price has risen by over 66%
Today, UBS officially completed the acquisition of Credit Suisse. After the announcement, UBS's stock price rose by over 1.2% during Friday's trading, accumulating a total increase of about 9% year-to-date.
On Friday, May 31st, UBS announced that the historic acquisition of Credit Suisse has been successfully completed. At the same time, Credit Suisse has been deregistered in Zurich and will no longer exist as an independent entity.
According to UBS's statement, the bank has inherited all assets and operations of Credit Suisse Group, including all outstanding debt instruments such as bonds or loans. Starting from June 7th, Credit Suisse and UBS will merge into one entity and trade in the US market as an intermediate holding company.
UBS Group CEO Sergio Ermotti stated in the announcement that the completion of the merger is a "significant milestone" and the merger can bring many benefits. For example, UBS can migrate Credit Suisse's clients to UBS's platform. Furthermore, starting from the second half of 2024, the merger can reduce duplicate administrative and operational costs, improve capital efficiency, obtain better credit terms, reduce borrowing costs, and achieve better tax benefits.
The background of UBS's acquisition of Credit Suisse is that after the 2008 financial crisis, wealth management became a "battleground." In order to strengthen its leadership position in the global wealth management market, especially in the US, UBS acquired the "struggling" Credit Suisse in June 2023 for $30 billion, a deal that was supported by the Swiss government.
Despite the challenges along the acquisition journey, UBS has further expanded its business footprint in Europe and Asia. The UBS CEO has stated that since the acquisition, UBS's asset size has significantly increased. For example, earlier this month, UBS returned to profitability after two consecutive quarters of losses, exceeding analyst expectations. UBS's profitability was partly due to the $38.3 billion in revenue brought by Credit Suisse and the addition of $27 billion in asset size to UBS's global wealth management division from the acquisition of Credit Suisse's clients.
After an initial period of skepticism, investors have gradually recognized the long-term value and potential benefits brought by this acquisition. Since acquiring Credit Suisse, UBS's stock price has risen by over 66%