The financial cushion will help absorb potential losses and could provide a boost to the lender’s second-quarter profit if UBS closes the transaction next month as planned.
UBS said the estimates were preliminary and the figures could change later. The bank also noted that it may record restructuring provisions in the future, but did not offer figures.
UBS agreed in March to buy Credit Suisse for 3 billion Swiss francs ($3.4 billion) in shares and take up to 5 billion francs in losses that would result from the liquidation of part of the business, in a quick merger engineered by Swiss authorities. over a weekend in the midst of a global banking turmoil.
The operation, the first bank bailout since the 2008 financial crisis, will create a wealth manager with more than $5 trillion in invested assets and more than 120,000 employees worldwide.
The Swiss state is backing the operation with up to 250 billion Swiss francs in public funds.
The Swiss government offers a guarantee of up to 9 billion francs for possible further losses on a clearly defined part of Credit Suisse’s portfolio.
Credit Suisse faces certain restrictions on its ability to do business until its acquisition by UBS is complete, according to a regulatory filing on Tuesday.
Following the legal closing of the transaction, UBS Group AG plans to manage two separate parent companies: UBS AG and Credit Suisse AG, UBS said last week. The integration process could last between three and four years.
During that time, each institution will continue to have its own subsidiaries and branches, serving its clients and dealing with counterparties.