Elon Musk Shocked by $100 Billion Liquidity Support for Credit Suisse Rescue Deal

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Twitter CEO Elon Musk has expressed his shock that investment banking company UBS would get a $100 billion emergency credit line as part of a $2 billion deal to buy rival Credit Suisse.

Taking to Twitter, Musk responded to a tweet linking to an article reporting on the deal between the two financial institutions which was announced on March 19.

โ€œSo UBS buys Credit Suisse, shareholders donโ€™t get a vote, UBS gets $100 billion credit line from central bankโ€ฆ,โ€ Twitter user Wall Street Silver posted alongside the link. โ€œCrazy times this week. Band-aids flying everywhere to keep the system from falling apart.โ€

โ€œ$100 billion lineโ€ฆwow,โ€ SpaceX founder and Tesla CEO Musk replied.

UBS announced its takeover of Credit Suisseโ€”which is among 30 financial institutions known as globally systemically important banksโ€”on Sunday.

The move hopes to stave off a collapse of the 167-year-old  global investment bank as well as broader financial market chaos after shares of the Swiss lender plunged.

Deal Will โ€˜Protect Swiss Economyโ€™

Under the deal, which was mediated by the Swiss federal government, UBS is buying Credit Suisse for around $3.23 billion. Credit Suisse shareholders will receive 1 UBS share for every 22.48 Credit Suisse shares held, equivalent to CHF 0.76 per share, which is substantially less than  Credit Suisseโ€™s closing price of CHF 1.86 on March 17.

โ€œWith the takeover of Credit Suisse by UBS, a solution has been found to secure financial stability and protect the Swiss economy in this exceptional situation,โ€ the Swiss National Bank (SNB) said in a statement.

SNB said it will also provide more than 100 billion Swiss francs of liquidity to UBS in order to help facilitate a smooth deal.

โ€œIn addition, and based on the Federal Councilโ€™s Emergency Ordinance, Credit Suisse and UBS can obtain a liquidity assistance loan with privileged creditor status in bankruptcy for a total amount of up to CHF 100 billion ($108 billion),โ€ SNB said.

Byย Katabella Roberts

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