Credit Suisse: another rollercoaster ride in Zurich
(CercleFinance.com) - After rebounding the day before, Credit Suisse shares fell back heavily on the Zurich stock exchange on Friday amid persistent concerns about the financial strength of the second largest Swiss bank.
The stock has continued the yo-yo trend that began at the start of the week, with investors alternating between selling the stock heavily and buying it the next day.
Since the beginning of the week, its share price has fallen by over 25%, which, unless there is a spectacular reversal of the trend between now and the end of the week, should correspond to its final weekly decline.
This new rollercoaster session underlines the lack of confidence of investors in the health of the institution, despite the efforts undertaken by the Swiss authorities to try to restore calm.
The Swiss National Bank (SNB)'s huge bailout this week will help solve the bank's immediate cash flow problems, but it is probably not the end of the story given the fundamental difficulties facing the bank, said analysts at Capital Economics.
The 50 billion Swiss franc loan from the SNB will not, on its own, save the bank because it is ultimately small in relation to the figures, confirmed Octo AM.
It points out that deposits, the bank's source of financing and therefore of profitability, have shrunk by 320 billion Swiss francs over 2022, with outstandings falling from 1,614 billion to 1,294 billion Swiss francs.
Invesco says that Credit Suisse is considered a "systemic" bank with 531 billion Swiss francs in assets, an amount that is very unpleasantly reminiscent of the Lehman Brothers collapse, the asset manager recalls.
This series of negative news and events comes at a time when the bank is struggling to convince investors that its plan to reorganise and reposition its business model can actually succeed, Generali Investments said.
For all these reasons, the Swiss bank now seems to be going through a confidence crisis amongst investors.
Copyright (c) 2023 CercleFinance.com. All rights reserved.
The stock has continued the yo-yo trend that began at the start of the week, with investors alternating between selling the stock heavily and buying it the next day.
Since the beginning of the week, its share price has fallen by over 25%, which, unless there is a spectacular reversal of the trend between now and the end of the week, should correspond to its final weekly decline.
This new rollercoaster session underlines the lack of confidence of investors in the health of the institution, despite the efforts undertaken by the Swiss authorities to try to restore calm.
The Swiss National Bank (SNB)'s huge bailout this week will help solve the bank's immediate cash flow problems, but it is probably not the end of the story given the fundamental difficulties facing the bank, said analysts at Capital Economics.
The 50 billion Swiss franc loan from the SNB will not, on its own, save the bank because it is ultimately small in relation to the figures, confirmed Octo AM.
It points out that deposits, the bank's source of financing and therefore of profitability, have shrunk by 320 billion Swiss francs over 2022, with outstandings falling from 1,614 billion to 1,294 billion Swiss francs.
Invesco says that Credit Suisse is considered a "systemic" bank with 531 billion Swiss francs in assets, an amount that is very unpleasantly reminiscent of the Lehman Brothers collapse, the asset manager recalls.
This series of negative news and events comes at a time when the bank is struggling to convince investors that its plan to reorganise and reposition its business model can actually succeed, Generali Investments said.
For all these reasons, the Swiss bank now seems to be going through a confidence crisis amongst investors.
Copyright (c) 2023 CercleFinance.com. All rights reserved.