Turmoil in Credit Suisse stock is ‘completely unwarranted’: SNB
Credit Suisse Group AG (NYSE: CS) is trading up this morning after announcing a $54 billion loan from the Swiss National Bank.
Credit Suisse to buy back debt as well
The stock market news helped eased investors’ fears that the financial services giant could be next in line to fail like Silicon Valley Bank and Signature Bank did in recent days (read more).
Credit Suisse is also launching a tender to repurchase close to $3.25 billion of its beaten-up debt. According to CEO Ulrich Koerner:
These measures demonstrate decisive action to strengthen Credit Suisse as we continue our strategic transformation to deliver value to clients and stakeholders. We’re resolved to deliver a simpler and more focused bank.
Versus the start of the year, Credit Suisse stock is still down more than 40% at writing.
SNB chairman reacts to the ongoing sell-off
Credit Suisse was also hit hard this week because its largest investor – the Saudi National Bank recently confirmed that it won’t increase its stake in “CS” due to regulatory restrictions.
On Thursday, though, it did tag the ongoing turmoil in shares of the Swiss bank as “unwarranted”. Speaking with CNBC, Ammar Al Khudairy – Chairman of SNB said:
It’s panic. I believe completely unwarranted, whether it be for Credit Suisse or for the entire market. We did have a failure last week but that’s nowhere near what we saw in 2008. Regulators have cut off possibilities of a spillover.
Saudi National Bank currently has a 9.9% stake in Credit Suisse that recently warned of material weakness in its financial reporting over the past two years.
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