THURSDAY, Swiss credit announced steps to bolster its liquidity by securing up to $54 billion from the Swiss National Bank. The decision follows a sharp 30% drop in the bank’s shares, raising concerns about the banking sector’s deposit crisis. Regulators and financial executives temporarily stabilized markets following the collapse of Silicon Valley Bank (SVB) last week, but fresh concerns over Credit Suisse have reignited anxiety.
In a statementCredit Suisse said the additional liquidity would support its “core businesses and customers as Credit Suisse takes the steps necessary to create a simpler, more focused bank built around customer needs.”
Along with the Swiss National Bank loan, Credit Suisse said it bought back much of its debt to better manage its liabilities and spending.
Once a major player on Wall Street, Credit Suisse has experienced compliance failures and other missteps, damaging its reputation with clients and investors. The bank launched a “radical” plan to revamp its operations in October, including cutting 9,000 full-time jobs, splitting off its investment bank and focusing on wealth management. CNN reports that analysts predict the lender may need additional funds to absorb potential losses in 2023.
Despite market turmoil caused by the collapse of SVB and Signature Bank In the United States, Credit Suisse CEO Ulrich Krner said the bank recorded “significant inflows” of money on Monday.