ZURICH, March 15 (Portal) – Shares in Credit Suisse (CSGN.S) slid on Wednesday, falling as much as 10.5% to a new record low, as its biggest investor said it could not give the Swiss bank another one provide financial support.
“We can’t because we would go over 10%. It is a regulatory issue,” Saudi National Bank (1180.SE) Chairman Ammar Al Khudairy said on Wednesday.
The Saudi lender acquired a nearly 10% stake last year after participating in Credit Suisse’s capital raise and pledging to invest up to 1.5 billion Swiss francs ($1.5 billion).
Credit Suisse released its 2022 annual report on Tuesday, saying the bank had identified “material weaknesses” in its financial reporting controls and had yet to stem client outflows.
Switzerland’s second-largest bank is trying to recover from a series of scandals that have eroded investor and customer confidence. Customer outflows increased to over 110 billion Swiss francs ($120 billion) in the fourth quarter.
last update
Watch 2 more stories
Shares were last down 10.2% to 2.01 Swiss francs ($2.19) in Zurich, heading for a seventh straight day decline.
The cost of insuring corporate bonds against default also skyrocketed. Five-year credit default swaps on Credit Suisse debt widened 533 basis points from 549 basis points at the last close, according to data from S&P Global Market Intelligence.
Broader equity markets fell sharply, reversing earlier gains, as the decline in Credit Suisse shares reignited some of investor jitters about the resilience of the global banking system following the Silicon Valley Bank (SIVB.O) collapse.
($1 = 0.9173 Swiss Francs)
Reporting by Noele Illien; Edited by Amanda Cooper and Elisa Martinuzzi
Our standards: The Trust Principles.