ZURICH/FRANKFURT (dpa-AFX) - After the laboriously negotiated takeover of ailing Credit Suisse by major Swiss bank UBS, unrest continues to reign in financial markets. On the most important Asian stock exchanges it went on Monday predominantly downward. The German benchmark index Dax also started trading with discounts. In particular, the shares of Deutsche Bank and Commerzbank lost significant value.

Both the billion euro deal in Switzerland and the measures taken by several central banks to provide liquidity to the financial system did little to counter fears of a banking crisis. The mood for banks remains depressed, investors continued to withdraw. The euro initially hardly reacted on Monday morning. Gold, on the other hand, rose significantly: The continuing uncertainty in the financial markets drove the gold price on Monday for the first time in a long time above the mark of 2000 U.S. dollars.

For banks and insurers, after the "emergency rescue" of Credit Suisse, another troubled day with price losses loomed. Credit Suisse shares themselves slumped more than 60 percent to 0.697 francs in pre-market trading in Switzerland. UBS shares lost about 14 percent. Deutsche Bank shares fell by more than nine percent and Commerzbank shares by more than seven percent.

Uncertainty was caused by the fact that holders of Credit Suisse's quasi-equity bonds are to lose all their invested money in the course of the takeover. This involves so-called AT1 bonds in the amount of 16 billion Swiss francs (16.2 billion euros), as Credit Suisse and the financial regulator Finma had announced on Sunday.

Deutsche Bank, however, sees itself hardly affected by this. The Dax group has "almost zero" exposure to these Credit Suisse bonds, a spokesman said Monday. Commerzbank has no money at all invested in its Swiss rival's AT1 bonds, according to a spokesman.

UBS is taking over its smaller local rival for three billion francs (just over 3 billion euros). In addition, it is liable for losses of up to five billion francs. In addition, there is a state loss guarantee of 9 billion francs and liquidity commitments of up to 200 billion francs.

The Swiss National Bank (SNB) is supporting the transaction with liquidity assistance and is granting the banks a loan of up to 100 billion francs. In addition, the SNB could grant Credit Suisse a liquidity support loan of up to 100 billion francs secured by a default guarantee from the Swiss government. The Swiss government secured a guarantee of 9 billion francs for UBS. Other central banks welcomed the measures.

A takeover of Credit Suisse, Switzerland's second-largest bank, by the larger UBS is the most significant bank merger in Europe since the financial crisis 15 years ago. It spells the end for 167-year-old Credit Suisse, whose headquarters are across the street from rival UBS on Zurich's Paradeplatz. The deal was preceded by marathon negotiations involving the two banks and top political and regulatory officials. The government and regulators were concerned with preventing a conflagration.

The Swiss government in Bern was under considerable pressure to stabilize the situation and prop up Credit Suisse. After all, Credit Suisse is one of the world's largest asset managers and is one of the 30 global systemically important banks whose failure would shake the international financial system.

Swiss President Alain Berset said "the Federal Council is convinced that the takeover is the best solution to restore confidence." Credit Suisse had lost customer confidence, liquidity had to be guaranteed. The transaction was important for the stability of the Swiss financial center, it added. SNB President Thomas Jordan stressed that reputation is central to Switzerland's economy.

Finance Minister Karin Keller-Suter said the federal government gave the CHF 9 billion guarantee to cushion Credit Suisse's risks. "Taxpayers have little risk" - any other scenario would have cost more. He said one has a private partner and a solid bank taking over Credit Suisse. It was not a government bailout, the minister stressed. The federal government had merely provided a guarantee.

UBS Chairman Colm Kelleher spoke of a huge opportunity for UBS. The combination of the two banks strengthens its position, he said. The Swiss Financial Market Supervisory Authority (Finma) welcomed the takeover solution and the measures taken by the federal government and the Swiss National Bank (SNB). Credit Suisse had been at risk of insolvency, even though the bank remained solvent, it added.

Credit Suisse had recently suffered from a significant loss of investor confidence. Its share price had fallen to a record low after the bank's largest investor ruled out providing further capital and the institution continued to struggle with cash outflows.

The merger to create a new industry giant is expected to create a financial institution with more than $5 trillion in assets under management, according to UBS. No statements could be made about possible job cuts, it said Sunday evening. Together, the two institutions employ about 120,000 people.

UBS, with more than 72,000 employees, had total assets equivalent to 1,030 billion euros in 2022, while Credit Suisse, with just over 50,000 employees, had total assets equivalent to 535.44 billion euros. UBS had made a profit of $7.6 billion (currently 7.07 billion euros) in 2022. Credit Suisse, on the other hand, reported a loss of 7.3 billion francs (7.4 billion euros)./mrd/oe/stw/DP/stk