Swiss regulator rules out UBS antitrust action over Credit Suisse deal

Switzerland’s financial regulator ruled on Wednesday that the UBS takeover of Credit Suisse did not create any competition concerns, despite recommendations from the country’s antitrust watchdog that it merited further scrutiny.

There has been vigorous debate in Switzerland about the size and power of UBS, which analysts say has a dominant position in areas such as Swiss loan and debt markets since it took over Credit Suisse last year in a state-engineered rescue.

“The merger of UBS and Credit Suisse will not eliminate effective competition in any market segment,” Swiss financial regulator FINMA said in a statement.

The decision follows a report, which was only made public on Wednesday, by competition authority COMCO which was sent in September to FINMA, whose decision has essentially drawn a line under the issue.

UBS said it will continue to implement its integration of Credit Suisse after FINMA’s report.

COMCO’s role in assessing the impact of mergers was suspended at the time as Swiss authorities used emergency laws to push the deal through. But the agency can still examine UBS’ position in specific markets on competition-related concerns.

UBS, which bought its longtime rival in the biggest banking rescue since the 2008/9 financial crisis, had considered selling Credit Suisse’s domestic business but ultimately opted not to.

The historic takeover eliminated one of the two giants of the Swiss banking landscape, and stirred fears that any problems at UBS could upend the Swiss economy.

It also narrowed the financing options for the country’s high-cost, export-orientated companies, especially with Credit Suisse seen as the bank which supported entrepreneurs.

UBS Chief Executive Sergio Ermotti on Tuesday hit out at calls to set tougher regulations for his bank, saying “fear” and “populist” critics were doing down the business.

“When I look at the discussion after Credit Suisse’s rescue by UBS, I see more fear than courage,” he said in Lucerne.