Credit Suisse European Shares Take a Steep Dive as Saudi Bank Chairman Refuses to Offer Further Assistance

03/15/2023 11:01 • Metaverse Matters • 144 views

On March 15th, it was reported that the decline of Credit Suisse’s European shares widened to 18%, falling below 2 Swiss francs, causing a circuit breaker to suspend trading. Credit Suisse’s US stock market’s pre market decline also widened to 17%. The chairman of Saudi National Bank, its largest shareholder, said he would never provide more assistance to it.

Credit Suisse Europe shares fell to 18% due to circuit breaker suspension

Analysis based on this information:

On March 15th, Credit Suisse, a Switzerland-based global financial services company, saw a significant decline in its European shares, which fell below 2 Swiss francs, prompting a circuit breaker to suspend trading. The shares experienced a widening decline of 18% on the European market, while its US stock market’s pre-market decline also fell by 17%. This news is a significant blow for Credit Suisse because it is struggling to rebuild after a series of scandals and regulatory fines in recent years, affecting the bank’s reputation, causing major financial damage and undermining investors’ confidence.

Adding to the bleak outlook is the chairman of Saudi National Bank, Credit Suisse’s biggest shareholder, who refused to give any further assistance to the bank. This refusal is a considerable setback as Saudi National Bank has helped Credit Suisse in the past by providing substantial capital support. The bank has struggled with capital because of these scandals and regulatory fines, making Saudi National Bank’s refusal to provide assistance a significant setback for Credit Suisse.

Further decline in Credit Suisse’s stock could have more severe implications not just for the institution but also for the global financial industry. Although Credit Suisse has not played a dominant role in international finances, it is still a global systemically important bank (GSIB), making it subject to international scrutiny and regulation. By being a GSIB, Credit Suisse is exposed to systemic risks that could trigger severe consequences if not managed well.

In summary, Credit Suisse’s decline in shares and the Saudi National Bank chairman’s refusal of further support is a substantial setback for the bank. It could lead to a more drastic decline in shares, damaging the bank’s reputation, shaking investor confidence, and raising questions about the global financial system. While the bank’s future remains uncertain, investors and stakeholders in the bank will undoubtedly be watching and waiting for any significant moves by the bank or its shareholders.

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