Swiss National Bank gives oxygen to Credit Suisse
📍 After the storm comes the calm, or at least that is what the markets expect after another Credit Suisse stock market scare. However, the Swiss giant does not surprise anyone in the markets as it comes from several years of numerous internal scandals, bad risk management policy (Archegos and Greensill case), judicial investigations…
📍 The bank recognized flaws in publicly available financial information on Wednesday, and after statements from its major shareholder (Saudi National Bank), conceding that it will not pursue further capital increases, the alarm bells went off (CDS were at their highest level). Similar circumstances occurred to Credit Suisse the previous year, and they were resolved with a capital raise in which SNB took part.
📍 Even though Credit Suisse was given a CHF 50 billion credit line by the Swiss National Bank yesterday to help with its liquidity issues, some analysts are starting to doubt the bank’s status and think it is only a matter of time until a similar situation arises again.