UBS Group AG said on Tuesday it was in negotiations with Swiss authorities about loss protections related to its takeover of Credit Suisse Group AG and its regulatory capital requirements.
The disclosure underscores how some aspects of the tie-up between the two banks, arranged hastily over a weekend in mid-March by the Swiss government to stave off a broader banking crisis, have yet to be ironed out.
The Swiss government agreed at the time to shoulder up to 9 billion Swiss francs ($10.12 billion) in potential losses from the deal and offered liquidity assistance of up to 100 billion Swiss francs.
However a definitive loss protection agreement remains under negotiation, UBS said in a U.S. regulatory filing on Tuesday.
UBS said in the filing that it expected the main terms of the loss protection agreement to be agreed prior to the acquisition of Credit Suisse being completed.
The bank said it was also in talks with the Swiss regulator FINMA about “certain prudential capital requirements, risk weighted assets measures, and other capital and liquidity requirements for the combined firm”, but did not expect those to be finalized before the deal closes.
UBS has said it expects to complete the acquisition of Credit Suisse, which came to the brink of collapse in March following a string of financial scandals and mismanagement, by early June.
($1 = 0.8889 Swiss francs)
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