Swiss banks take separate routes to stronger balance sheets

UBS accepts a government rescue and will transfer $60 billion of illiquid assets to a dedicated fund, while Credit Suisse raises $9.1 billion in fresh capital from existing shareholders.

On the back of commitments earlier this week by European central banks to reinstate confidence in their banking systems, Credit Suisse and UBS both announced far-reaching measures to improve their balance sheets yesterday.

However, the two Swiss banks chose opposite routes to achieve this, reflecting their different levels of exposure to illiquid subprime-linked assets. This was evident earlier this year as well, with UBS already forced to raise billions worth of new capital, while Credit Suisse has until now not...

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