Bloomberg: Switzerland is contemplating taking a failing bank public.

The Swiss authorities are considering a "full or partial nationalization" of ailing banking giant Credit Suisse Group should a proposed merger with rival UBS fail to win approval from both shareholders and regulators. The UBS deal, in which the megabank would have picked up Credit Suisse for a bargain-basement $1 billion, leaves the Swiss government on the hook if the acquisition fails to quell the instability in the system. The authorities have already agreed to a rewrite of Swiss banking laws to allow the companies to bypass the required shareholder vote and fast-track the merger. The deal is unpopular with the bank's shareholders, as it would have paid them just CHF0.25 in UBS stock per share while their holdings were still worth CHF1.86 at the close of markets on Friday. UBS also wants protection from any pending legal cases or regulatory probes into its erstwhile rival that could result in fines or losses. Regulators are concerned that this alone is not enough to shore up confidence in the financial system.