A Credit Suisse Group AG office building at night in Bern, Switzerland, on Wednesday, March 15, 2023.
Stefan Wermuth | Bloomberg | Getty Images
Credit Suisse shares fell 5% in early trade Friday, after soaring over the previous session as the embattled lender said it will borrow up to 50 billion Swiss francs ($54 billion) from the Swiss National Bank.
The shares pared some losses to trade 3.4% lower by 20 a.m. London time.
This week’s intervention by Swiss authorities, who also reaffirmed that Credit Suisse met the capital and liquidity requirements imposed on “systemically important banks,” prompted shares to jump more than 18% on Thursday after closing at an all-time low on Wednesday.
The slide came after top investor the Saudi National Bank revealed it would not provide the bank with any more cash due to regulatory requirements, compounding a downward spiral in Credit Suisse’s share price that began with the delay of its annual results over financial reporting concerns.
The bank is undergoing a massive strategic overhaul aimed at restoring stability and profitability after a litany of losses and scandals. The restructure involves the spin-off of the investment bank to form U.S.-based CS First Boston, a steep reduction in exposure to risk-weighted assets, and a $4.2 billion capital raise funded in part by the 9.9% stake acquired by the Saudi National Bank.
However, capital markets have responded with skepticism. Credit Suisse has seen huge outflows in assets under management while credit default swaps, which insure bondholders against a company defaulting, soared to new record highs this week.
Read the full article here
