Swiss Finance Minister Karin Keller Sutter said on Saturday that the Swiss economy would likely have collapsed if Credit Suisse, Switzerland's second-largest bank, had declared bankruptcy.

Keller Sutter told Swiss newspaper Le Temps that the government had "acted in the best interests of the country" by quickly arranging for UBS to take over its rival.

Amid fears of a global banking crisis in March, investor confidence in Credit Suisse collapsed on March 15, after which the government coordinated an acquisition before reopening markets on March 20.

The state provided nearly 260 billion Swiss francs ($287 billion) in cash support and state guarantees to back up the acquisition and avert a financial collapse that could have been caused by the bank's uncontrolled collapse.

"Given the circumstances, we have done everything we can to reduce the burden on the state and taxpayers," Sutter said, adding: "Without the firm intervention of the authorities, Credit Sutter would have declared bankruptcy, which would have possibly led to the collapse of the Swiss economy."

Like UBS, Credit Suisse was among the world's 30 banks ranked as important to the international banking system, but in recent years the bank has suffered a series of scandals.

After the collapse of three U.S. regional banks in March, it appeared to be the weakest link in the chain.

Amendment of the Banking System

The finance minister said it was too early to talk about the future structure of UBS, which would become a huge bank.

The government's priority is to complete the acquisition, while UBS said on Wednesday it should complete the acquisition within the coming months.

The new combined bank will have $1.6 trillion in assets, twice the size of the Swiss economy, and more than 120,<> employees.

Keller Sutter said the government should analyse what happened and then amend the regulations on banks.

In another interview, the minister said UBS's state-sponsored acquisition of Credit Suisse should proceed smoothly without political obstacles.

The Swiss parliament is due to hold an extraordinary session days later to discuss the emergency merger, and Keller Sutter told the newspaper "Finanz und Wirtschaft" (Finanz und Wirtschaft) "There is a merger agreement between UBS and Credit Suisse, and the government has pledged to the National Bank to provide liquidity to Credit Suisse in order to ensure stability."

"The guarantee agreement with UBS is still being discussed, and in many meetings of the (parliamentary) committee I got the impression that politicians certainly don't want to spoil the acquisition."