By Dhirendra Tripathi
Investing.com – Credit Suisse (NYSE:CS) was up more than 1% during Friday’s trading on a Reuters report that said the embattled bank may seek a merger with its larger Swiss rival UBS (NYSE:UBS).
Credit Suisse's top management are under pressure to come up with an overhaul plan for the scandal-hit bank that could include a potential merger with rival UBS, Reuters said.
The bank's executives fear the flagship Swiss lender, left vulnerable by scandals, could be challenged by investors demanding its break-up, or that its shrinking stock-market value makes it a target for a foreign hostile takeover.
The bank has a market cap of $25.22 billion, approximately 28% off its 52-week high.
The Swiss bank has had to review its business after losing more than $5 billion in the rush to unwind trades by family office Archegos. It faces a barrage of legal actions for helping clients invest $10 billion in bonds issued by collapsed supply chain finance firm Greensill Capital.
As of May 25, it had recovered $5.9 billion of the $10 billion Greensill bonds, it told investors on Tuesday.
Credit Suisse took a charge of 4.4 billion Swiss francs ($4.79 billion) in the first quarter on account of the Archegos fiasco.
It said another 600 million Swiss francs on the same account was likely.