Swiss Giant, Credit Suisse is facing a serious financial crisis!
Their riskiest bonds sank Monday, and its shares hit record lows before recovering, as investors evaluated concerns about the Swiss bank’s financial health.
The cost of insuring Credit Suisse debt against default, as measured by credit-default swaps, also continued to climb
Tweet on Credit Suisse financial crisis
Credit Suisse stock hits a record low today !
The stock fell nearly 1% at 3.94 Swiss francs, paring some losses, after earlier trading as much as 11.6% lower, according to @FactSet
(Its U.S.-traded shares recently traded up 1.3%.) pic.twitter.com/rvE7YKVzGb
— The_Journalbiz (@the_journalbiz) October 3, 2022
Credit Suisse stock fluctuations, *chart by Bloomberg
The stock fell nearly 1% at 3.94 Swiss francs, paring some losses, after earlier trading as much as 11.6% lower, according to FactSet (Its U.S.-traded shares recently traded up 1.3%.)
A $1.55 billion additional tier-1 bond that can be redeemed from 2025 was earlier bid at about 65.6 cents on the dollar, Tradeweb data showed.
Credit Suisse said in July it would refashion its investment bank and exit some other businesses to become a less risky institution, following financial disasters that included a $5.1 billion hit last year from client Archegos Capital Management.
The lender has a large Swiss business serving all types of customers and competes globally in wealth management, investment banking and asset management.
Credit Suisse said it has close to a $100 billion capital buffer and continues to expect a 13% to 14% ratio for its highest quality equity capital through the rest of the year.
The stressed market prices indicate Credit Suisse could struggle to raise new shares to pay for a planned restructuring and that its funding costs could rise sharply.