Switzerland

Glencore’s Bunge redux may yield Teck benefits

26 May 2023

The Swiss commodity giant could merge the agri-trader it part-owns with its $14 bln US-listed peer. A Bunge deal would be oddly timed, and Glencore has other ways to raise cash. But the bid may offer a way to spur Glencore’s share price as it mulls a new offer for Canada’s Teck.

Syngenta’s China listing tweak seems a demotion

18 May 2023

The agrichemical giant scrapped a $9 bln IPO on the Nasdaq-like STAR Market to list on Shanghai’s main trading board instead. Beijing probably hopes to make Syngenta a poster child for the venue’s revamp without downsizing the offering. Valuations would suffer regardless.

UBS kitchen sink has protection from further leaks

17 May 2023

The bank reckons it might write down the assets on Credit Suisse’s balance sheet by $10 bln, inflate its liabilities by $3 bln, and take a $4 bln litigation hit. Those numbers could get bigger over time. But a low purchase price gives CEO Sergio Ermotti a chunky margin of error.

Credit Suisse debacle raises oversight question

9 May 2023

Swiss authorities hailed the state-backed rescue of the stricken lender by UBS as a commercial solution that will be light on domestic taxpayers. Banking professor and former SNB official Urs Birchler tells The Exchange podcast why the quick fix is far from ideal.

Glencore’s best Teck tactic is a surgical strike

28 Apr 2023

The Swiss commodities giant has little room to sweeten its $23 bln offer for the Canadian miner without hurting its own shareholders. It can, however, afford a disproportionately higher premium to the controlling Keevil family. Common-stock owners would have to see the upside.

Resolving Credit Suisse: an alternative history

27 Apr 2023

Swiss authorities merged the bank with UBS, rather than risk a financial panic by bailing in bondholders. Yet Credit Suisse was arguably unique and small enough to be wound down. Breakingviews imagines that scenario, which may serve as a template if the enlarged group ever fails.

New UBS investor pitch fits better than old one

25 Apr 2023

Rescuing Credit Suisse is a risky move. But first-quarter results show that the buyer’s existing business is struggling to grow. The merger offers large savings and creates a wealth giant with $3.5 trln of assets. The return of proven cost-cutter Sergio Ermotti as CEO helps.

Credit Suisse mess leaves scattered Swiss debris

24 Apr 2023

A $3 bln state-sponsored UBS takeover prevented the failure of Bern’s other big bank. Yet small, export-oriented Swiss firms now only have one large lender for their needs, and additional bank regulation is likely. Meanwhile, historic US tax issues may come home to roost.

UBS investors’ M&A fears are easing

24 Apr 2023

One question hanging over Chair Colm Kelleher’s Credit Suisse deal was whether there’d be many assets left by the time it closed. But the target’s outflows were smaller than they could have been, and the valuable local unit held up well. That buttresses shareholders’ confidence.

Rivals can feast on Credit Suisse client spoils

17 Apr 2023

UBS’s wealth assets may soar to $3.4 trln after buying its main competitor. Yet, smaller challengers are looking to poach private bankers, and clients will diversify away from the new mega-bank. And rival financial hubs have a golden opportunity to dent the Swiss wealth crown.

UBS can score a quick win with Swiss sale

12 Apr 2023

Chair Colm Kelleher’s acquisition of Credit Suisse is infuriating politicians. They fear the new bank will be too big in Switzerland and lead to job cuts. Selling or listing the domestic business would buy political goodwill and give UBS a tidy return on its $4 bln investment.

Glencore Teck tweak is necessary, not sufficient

11 Apr 2023

The Swiss group’s $23 bln offer for the Canadian miner now includes up to $8 bln of cash. That means its target’s shareholders can avoid taking payment in dirty coal shares. But Glencore may still have to raise the value of the overall bid to bring Teck investors on side.

Glencore’s Teck gambit could slip on an oily patch

6 Apr 2023

The Swiss commodity giant’s $22 bln plan to buy its Canadian peer and spin off its coal arm offers an alternative to investors voting on Teck’s own breakup plan. Yet Glencore’s oil trading unit may hurt the value of the non-coal bit. Teck’s pitch has flaws too, but looks cleaner.

Swiss mega-bank has scope to shrink to greatness

5 Apr 2023

Swallowing Credit Suisse propels UBS into the big leagues, with $3.4 trln of wealth assets and more dealmaking fees than Citi. Staying large means taking on volatile units and risky clients. Unlike previous empire-builders, CEO Sergio Ermotti has a remit to slash aggressively.

Glencore will have to dig deep for Canadian miner

3 Apr 2023

Teck Resources rejected the Swiss giant’s plan for a $23 bln all-share takeover and spinning off their combined coal units. The Canadian firm is pursuing its own split. Since the deal would help solve Glencore’s dirty-fuel problem, it will have to pay more to win over its target.

Swiss anger will sour UBS’s deal of the century

31 Mar 2023

Politicians and citizens are unhappy about job cuts and future risks arising from the bank’s $3 bln state-backed Credit Suisse rescue. Parliament fury may force returning CEO Sergio Ermotti to tweak the deal. Either way, an unsavory domestic whiff could hang over UBS for years.

Bank rescue real estate turns from dowry to downer

30 Mar 2023

In 2008, failed lenders like Bear Stearns owned prime property that helped underpin value for buyers. But Credit Suisse sold off much of its real estate before UBS swooped. Its long-term leases may prove a headache as remote working shrinks demand for office space.

Boomerang UBS boss ticks several important boxes

29 Mar 2023

Sergio Ermotti is returning as CEO after less than three years. The suboptimal governance move highlights a dearth of senior banking talent. But Ermotti’s record of shrinking an investment bank – and his Swiss passport – will be vital in the tricky integration of Credit Suisse.

Swiss CoCo litigation may have a broader payoff

23 Mar 2023

Holders of Credit Suisse’s $17 bln contingent convertible bonds think authorities were wrong to wipe them out. A legal challenge will take years. Still, Bern might decide to placate angry investors. And a fight will discourage countries considering following the Swiss example.

Credit Suisse rescue sends shockwaves far and wide

23 Mar 2023

The ailing Swiss lender was saved by UBS with a $3 bln takeover. In this Viewsroom podcast, Breakingviews columnists debate why the deal pushes up bank funding costs, how the new mega-lender affects Switzerland’s financial system, and why bank deposits are becoming less reliable.