UBS is considering buying all or part of Credit Suisse

UBS Group AG is considering a full or partial takeover of Credit Suisse Group AG at the urging of Swiss regulators after a crisis of confidence plagued its smaller rival, according to knowledge of the matter.

Swiss officials are urging UBS to explore various ways it could be involved in a solution for Credit Suisse, the people said, asking not to be named and to describe private conversations. Deliberations are ongoing and it’s unclear if a deal will come about, the people said.

The boards of Switzerland’s two largest banks are expected to meet separately this weekend to weigh the idea of ​​a combination, with talks being orchestrated by the Swiss National Bank and regulator Finma, the authorities said financial timeswho reported on the deliberations on the previous Friday.

UBS and Credit Suisse spokesmen declined to comment.

A government-brokered deal would address a defeat at Credit Suisse, which sent shockwaves through the global financial system this week as panicked investors dumped their stocks and bonds following the collapse of several smaller US lenders. A liquidity backstop from the Swiss central bank briefly halted the declines, but the market drama poses the risk that customers or counterparties will continue to flee, with possible repercussions for the broader industry.

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The government, central bank and Finma have been in close contact to discuss further ways to stabilize Credit Suisse, Bloomberg reported earlier this week. Among the ideas floated were a split of the bank’s Swiss unit and an orchestrated link with UBS, people familiar with the matter previously said.

UBS and Credit Suisse executives have opposed such an arranged merger, people familiar with the matter said earlier this week.

Credit Suisse’s market value has fallen to around 7.4 billion Swiss francs ($8 billion) from a peak of over 100 billion Swiss francs in 2007. The market value of UBS is CHF 60 billion.