New stock market collapse of European banks after the purchase of Credit Suisse by UBS

Major European stock markets opened the session this Monday with losses of more than 1%, after the rescue of Credit Suisse, which was bought by UBS, with a guarantee from the Swiss authorities.

In the early stages of the session, Madrid is the stock market that falls the most, 1.99%; while Milan brings 1.67%, London 1%; Frankfurt, 0.98%; and Paris, 0.90%. The Euro Stoxx 50 index, which groups large listed companies, left 0.97 percent.

European markets maintain the negative trend of the last sessions in anticipation of the situation in the financial system. The takeover of Credit Suisse by UBS was announced this weekend, a solution backed by the Swiss government, which offered a guarantee of more than 9,000 million euros.

the news was negative reception on the marketwhere European banks are falling sharply waiting for today’s intervention by the president European Central Bank (ECB), Christine Lagardewho is participating in a monetary policy dialogue with the Economic Affairs Committee of the European Parliament, in which he could refer to the banking crisis that shook the financial system in the last week.

For now, the actions of Credit Suisse and UBS This Monday’s session on the stock exchange in Zurich began with sharp falls after the agreement on the merger of the two largest entities in Switzerland. Shares in Credit Suisse fell nearly 64 percent at the open to 0.67 Swiss francs a share, below yesterday’s agreed takeover bid of 0.76 francs, while UBS shares lost 13 percent of their value.

This Sunday, Swiss authorities and two banks reached an agreement to buy Credit Suisse from UBS for 3,000 million Swiss francs (about 3,037 million euros), in an operation in which the Swiss government guarantees 100,000 million Swiss francs for the bank’s liquidity. and will assume up to 9 billion francs of possible losses.

Specifically, Credit Suisse shareholders will receive one UBS share for every 22.48 shares in the original entity, while the Swiss central bank, the SNB, will provide guarantees to guarantee the banking entities’ liquidity.

The figures released indicated the purchase by UBS at a price of 0.76 Swiss francs per share, a far cry from the 1.86 Swiss francs at which Credit Suisse traded at Friday’s close.

Tension in European banks

The tensions in the markets are reflected again this Monday in the prices of the main European banks, despite the decrease in liquidity announced by the major central banks. Thus, the shares of the French banks Société Générale and BNP Paribas brought 6.91 percent and 6.40 percent, respectively, while the Dutch ING left 5.66 percent, and the Italian UniCredit and Intesa Sanpaolo 4.97 percent and 3.31 percent, respectively.

For their part, German banks also traded with sharp falls, which exceeded 10% at Deutsche Bank, while at Commerzbank they were around 8%.