UBS asks Swiss government for $6 billion in costs to buy Credit Suisse

UBS asks Swiss government for $6 billion in costs to buy Credit Suisse

UBS AG is asking the Swiss government to cover about $6 billion in costs if it wants to buy Credit Suisse, a person with knowledge of the talks, as the two sides tried to hammer together a deal to restore confidence in the ailing Swiss bank.

Two people with knowledge of the matter said that the Swiss government could offer a guarantee against the risks involved in a takeover of Credit Suisse by UBS.

Berkshire Hathaway Inc's Warren Buffett has had discussions with senior Biden administration officials about the banking crisis, a source familiar with the matter told Reuters.

Five major banks, including Societe Generale and Deutsche Bank, are limiting new trades involving Credit Suisse or its securities.

Sources told Reuters.

U.S. investment giant BlackRock denied a report in the Financial Times that it was participating in a rival bid for all or parts of Credit Suisse.

The Mid-Size Bank Coalition of America has asked regulators to extend federal deposit insurance to all deposits for the next two years, according to a letter from the coalition.

The banking industry's descent into turmoil has shaken global markets and governments, reviving eerie memories of the global financial crisis. The effects may be long-lasting like 2008.

Pierre Wunsch, a member of the European Central Bank Governing Council, said he did not expect a repeat of the 2008 financial crisis despite the collapse of Silicon Valley Bank, saying European banks were subject to tougher rules than regional U.S. banks.

Goldman Sachs has cut its recommendation on exposure to European bank debt to neutral from overweight, saying a lack of clarity on Credit Suisse's future path would put pressure on the broader sector.

A People's Bank of China official said the collapse of SVB showed how rapid monetary policy shifts were having spillover effects, according to the state-owned newspaper Shanghai Securities News.

As banks worry about the market, investors are seeking protection against a market crash.