Switzerland's second largest bank, Credit Suisse, is to buy the United States brokerage firm, Donaldson, Lufkin and Jenrette (DLJ) for $11.5 billion (SFr19.67 billion).

The bank plans to merge DLJ with its investment-banking arm, Credit Suisse First Boston.

Shares in DLJ, which is 70 per cent owned by French insurance giant, Axa, soared on the New York Stock Exchange on Tuesday as rumours of the sale emerged. Shares rose $15 to reach a yearly high of $81. Credit Suisse is expected to pay $90 per share.

Neither firm has commented on the news, but an official announcement is expected on Wednesday.

If the sale goes ahead, Credit Suisse will be the second Swiss bank in two months to acquire a US brokerage firm. In July UBS bought PaineWebber for $10.8 billion.

This latest deal would give Credit Suisse ownership of one of Wall Street's best-established private equity businesses, with $125 billion in assets under management, an online brokerage and the Pershing clearing operation.

The deal will also upgrade Credit Suisse First Boston's investment banking capabilities. Analysts expect that cost savings could reach as much as $1 billion because of a significant overlap in the firms' equities operations, as well as in management and support staff.

Talks with Axa have gone on intermittently for the last three years. It is also understood that Credit Suisse beat out a number of rivals to clinch the deal.

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