Switzerland's financial watchdog said Wednesday that the takeover of fallen bank Credit Suisse by rival UBS will not eliminate competition even though it will strengthen the position of the country's biggest lender.

The Swiss government compelled UBS to acquire Credit Suisse last year to prevent it from collapsing, but the mega merger has raised concerns over the new bank's size relative to the country's economy.

The Swiss Financial Market Supervisory Authority (FINMA) said Wednesday that it had concluded its antitrust control procedure without imposing any conditions and obligations on the bank.

"FINMA concluded that the merger of UBS with Credit Suisse will not eliminate effective competition in any market segment, even if UBS has been able to strengthen its market position in certain sub-segments," it said.

The authority, which had been involved in the government-led negotiations for the $3.25 billion merger, had already approved the merger in March 2023.

FINMA said Wednesday that "this measure was in the interests of creditor protection and was necessary to prevent greater harm to the Swiss financial centre and the international financial markets."

UBS said in a statement that it "takes note" of the authority's decision.

"We will continue to focus on fostering a vibrant, competitive and fair environment, executing on our integration plans and remaining a pillar of economic support in Switzerland and all communities where we live and work," the bank said.