Credit Suisse Group AG’s troubles are most likely to end in a takeover of the Swiss bank, according to analysts at JPMorgan Chase & Co.

Analysts led by Kian Abouhossein laid out three scenarios for Credit Suisse’s future, with the most probable being an acquisition by UBS Group AG. Credit Suisse’s capital position isn’t an issue, but the “situation is about ongoing market confidence issues with its IB strategy and ongoing franchise erosion,” Abouhossein wrote in a note. “Status quo is no longer an option.”

Spokespeople at Credit Suisse and UBS declined to comment.

Abouhossein has been wary about Credit Suisse — rating the shares either neutral or underweight for almost two years. He warned last month that the bank was deteriorating faster than expected, and the shares have fallen 26 percent since then.

JPMorgan’s scenarios for Credit Suisse:

  • A takeover, likely by UBS. Given the market concentration between the pair, a takeover would possibly be followed by a listing or spinoff of the Swiss Bank, worth 10 billion Swiss francs.
  • The Swiss National Bank stepping in with full deposit guarantee or injecting equity. That would give Credit Suisse time to restructure but it would be highly dilutive for existing shareholders.
  • A “self-help approach,” with the closure of the investment bank. Still, this may not be enough to reduce market concerns.

A tie-up with UBS was one option discussed in talks between Credit Suisse and Swiss authorities about how to stabilize the bank, according to people familiar with the matter. UBS CEO Ralph Hamers on Wednesday declined to answer any “hypothetical” questions about Credit Suisse. In a memo to staff on Thursday, Credit Suisse CEO Ulrich Koerner said the bank would continue to focus on its turnaround plan.

Analysts at KBW also backed the view that Credit Suisse is heading for a major restructuring. They wrote that a break-up is the most likely outcome, with further asset sales to “simplify the bank.”

In contrast, analysts at Bank of America Corp. said the support from the Swiss National Bank is a clear message it will continue in its current form. The bank is one of just two firms tracked by Bloomberg that rate Credit Suisse a buy.