Sturnaras: Greek banks’ risk in Credit Suisse is ‘nearly zero’

“They (Greek banks) are not linked to Credit Suisse’s additional Tier 1,” said Sturnaras, who is also a member of the ECB’s 26-member governing board. He added that Greek banks are reliable.

Mr Sturnar’s remarks came after news that Credit Suisse’s AT1 bonds, totaling $17 billion, are due to be written down, unsettling already turbulent global markets as debt fell sharply starting in Asian trading. from Monday morning. However, the risks from the purchase of this type of securities were clearly indicated by the bank when they were issued.

In order to APE MPE

As it became known on Sunday, March 19, the largest Swiss bank UBS agreed to buy the second largest bank Credit Suisse for 3 billion francs ($3.24 billion), Credit Suisse said in a statement. The deal will put an end to the uncertainty that has persisted around Credit Suisse in recent weeks. The bank, which faced a collapse in shares and an outflow of depositors’ funds, first tried to get out of the crisis on its own by applying to the local Central Bank for a $54 billion credit line. However, by the end of last week, there were two options left to save the credit institution – either a takeover by UBS, or nationalization. As a result, the banking regulator – the Swiss National Bank – chose the first option. The amount of the transaction, based on the price per share, was more than two times less than the value of Credit Suisse securities on Friday, March 17th.

In this case, the transaction will not be cash. Under its terms, Credit Suisse shareholders will receive a UBS share for every 22.5 Credit Suisse shares. Credit Suisse AT1 subordinated bonds worth $17 billion will be written down to zero. The local Central Bank, to ensure liquidity, is ready to allocate 100 billion Swiss francs ($108 billion) to UBS and Credit Suisse. In addition, UBS will receive guarantees from the Swiss government for 9 billion francs to cover possible losses from the takeover.

Until the closing of the deal, the Credit Suisse brand will be preserved, its further fate will be decided by UBS. The value of this brand as early as the beginning of 2023 evaluated at $5.63 billion.