Credit Suisse (CSGN.S) has lost a quarter of its value on Wednesday. According to Reuters report, it has fallen to a new record low.
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Credit Suisse (CSGN.S) has lost a quarter of its value on Wednesday. It has fallen to a new record low. This is because its biggest investor said that he cannot provide much financial support to the Swiss bank. Saudi National Bank Chairman Ammar Al Khudairi said that we cannot, because we cannot go above 10 percent. He said that this is a regulatory matter.
Sharp fall in stock markets around the world
The Saudi bank had participated in Credit Suisse’s capital raising plan last year. And had acquired a stake of about 10 percent. With this, the bank had also committed to invest up to $1.5 billion. After this, there has been a sharp decline in the stock markets around the world. This fall of 24 per cent in the value of Credit Suisse has raised doubts among investors about the strength of the global banking system after the collapse of the Silicon Valley bank.
Speaking at a Morgan Stanley conference call on Wednesday, Ralph Hamers, chief executive of rival Swiss bank UBS, said the bank has benefited from recent market volatility and seen an inflow of money.
What do the experts say?
Hamers said that in the last few days as you are expecting, we have seen the investment coming. He said that it clearly seems that people want security. But they think that no trend is formed for three days. Credit Suisse published its annual report for 2022 on Tuesday. In this, he said that the bank has identified major weaknesses in financial reporting and yet it has not seen the outflow of customers.
Earlier, the California-based Silicon Valley Bank, the 16th largest bank in the US, was shut down by the California Department of Financial Security on Friday. It has appointed the FDIC as the bank’s conciliator, which ran into trouble when its customers, including venture capital firms and their backed companies, began withdrawing their deposits.