BREAKING: UBS Offers $2 billion For Troubled Credit Suisse

It further notes that “UBS will now pay more than SFr0.50 a share in its own stock, up from a bid of SFr0.25 earlier today worth around $1bn that was rejected by the Credit Suisse bid. But the price remains far below Credit Suisse’s closing price of SFr1.86 on Friday, the sources said.

Two people close to the deal reportedly confirmed that the Swiss National Bank has agreed to offer a $100bn liquidity line to UBS as part of the deal.

UBS has as well agreed to a softening of a material adverse change clause that would void the deal if its credit default spreads jump. The material adverse change clause applies for the period between the signing and closing of the deal.

There has been limited contact between the two lenders and the terms have been heavily influenced by the Swiss National Bank and regulator Finma, Financial Times reports, quoting its sources.

The US Federal Reserve has given its assent to the deal, they added. Vincent Kaufmann, chief executive of Ethos Foundation, which represents Swiss pension funds that own between 3 per cent and 5 per cent of Credit Suisse and UBS, told the Financial Times that the move to bypass a shareholder vote on the deal was poor corporate governance.

“I can’t believe our members and UBS shareholders will be happy about this,” he said. “I have never seen such measures taken; it shows how bad the situation is.”

Meanwhile, Saudi Arabia, a major investor in Credit Suisse had said it would not bail out the bank as it struggles to avert a collapse.