According to the Financial Times, UBS is in talks to take over all or part of rival Credit Suisse with the blessing of Swiss regulators. According to the newspaper, an agreement may be imminent, but there is "no guarantee".
Credit Suisse, the Swiss National Bank (SNB) and the Swiss financial regulator Finma did not want to comment on the reports of a possible takeover by UBS on Saturday.
A purchase of this size would be complex: UBS would need government guarantees to cover legal costs and potential losses, according to financial news agency Bloomberg. In addition, the takeover of the country's second largest bank by the largest bank could raise eyebrows at the Swiss Competition Commission.
The Swiss government held an emergency meeting in Bern on Saturday evening to discuss the situation at Credit Suisse. A government spokesman declined to comment on the talks with the Swiss news agency ATS.
The "Neue Zürcher Zeitung" wrote that the government had gathered at the Ministry of Finance for a two-hour meeting, which was also attended by several experts and officials.
UBS and Credit Suisse are among the 30 banks worldwide that are considered "too big to fail" because their failure would have a devastating impact on the wider economy.
Credit Suisse has come under further pressure after a series of previous scandals, including the closure of two US banks, Silicon Valley Bank and Signature Bank, which had worried the sector. Statements by the largest shareholder from Saudi Arabia, the Saudi National Bank, that they did not want to increase investments in the Swiss institute sent the price plummeting.
Despite massive support from the SNB, the Credit Suisse share price collapsed again on Friday after a brief recovery. It is now eagerly awaited whether the major bank can avoid another slide when trading on the Swiss stock exchange begins at 09:00 CET on Monday.