ZURICH (Reuters) - (In last paragraph, corrects to show Knight Vinke's stake is below the disclosure threshold so cannot be verified; also adds Knight's confirmation of comments in May 3 story)
Swiss bank UBS could combine its investment banking arm with that of Credit Suisse to create a top player, Eric Knight, head of activist investor Knight Vinke, was quoted as saying in an interview with a Swiss paper on Sunday.
Knight Vinke said last month UBS should look at spinning off or merging its investment bank so the group can focus on its wealth and asset management businesses.
Asked whether he thought UBS and Credit Suisse should combine their investment banks, Knight told Sonntagszeitung: "Such a combination could be an interesting way to reach critical mass and the shareholders of both groups could profit from large synergy effects.
"The fusion would create a top player. But there are other possible partners, for instance Deutsche Bank," he was quoted as saying.
Knight told Reuters last year he believed UBS would eventually follow his advice and split off its investment bank.
UBS will hold its shareholder meeting on May 7.
Knight, who confirmed the comments by email late on Sunday, has said he believes UBS's wealth management business would thrive on its own. Knight Vinke has previously said it holds a stake of roughly 1 percent in the Swiss bank. This is below a threshold that has to be declared publicly under Swiss securities law.
Reporting by Alice Baghdjian; Editing by David Holmes