The Swiss public prosecutor’s office is examining the takeover of Credit Suisse by competitor UBS

Swiss authorities have opened an investigation into the £2.6 billion emergency takeover of Credit Suisse by competitor UBS.

Federal prosecutors are investigating possible criminal law violations by government officials, regulators and executives at the two banks. UBS and Credit Suisse struck the deal over a hectic weekend two weeks ago.

There were fears that without a bailout, Credit Suisse would implode – potentially leading to a meltdown for the broader global banking sector.

Prosecutors said yesterday that there were “numerous aspects of the events surrounding Credit Suisse” that warranted an investigation and that these needed to be analyzed in order to “identify any criminal offenses that could fall within the jurisdiction of the Federal Court of Justice.” [prosecutor]’.

“The Attorney General wants to proactively fulfill its mandate and responsibility to contribute to a clean Swiss financial center and has set up a monitoring system to be able to intervene immediately on all issues falling within its area of ​​responsibility,” the Attorney General’s statement said.

It did not specify any specific aspects of the acquisition that would be investigated or how long the investigation might take.

Both UBS and Credit Suisse declined to comment.

Last month’s deal came as Credit Suisse was on the brink. The perpetually troubled lender was already struggling to recover after a £99 billion cash outflow late last year helped push it into a £6.5 billion annual loss. It suffered another wobble following the collapse of a string of US lenders, including Silicon Valley Bank.

Then, the statement by its largest shareholder, the Saudi National Bank, that it would not invest any more funds led to another sharp drop in the share price.

This led to the so-called “shotgun marriage” with UBS orchestrated by the Swiss government, central bank and financial regulators.

Some observers believe the deal will prove to be a huge hit for the buyer, acquiring its longtime rival at a bargain price. For many of the combined group’s 120,000 employees – 11,000 of them in the UK – it is likely to prove less fortunate.

Reports in Switzerland over the weekend suggest this will result in up to 30 per cent job losses – which could mean thousands in London, although details on where the ax will fall are not yet known.

A survey of Swiss economists found that 48 percent would have preferred a government takeover and a possible later sale of Credit Suisse, while only 19 percent saw the UBS deal as the best option.

The sheer size of the new institution, which will have assets of £1.3 trillion, is a cause for concern, as is the amount of liquidity support and guarantees worth £230bn to be provided by the Swiss government and the Central Bank of the United Kingdom country are offered.

Shareholders will have an opportunity to raise grievances about the takeover when both banks hold their annual general meetings this week.