Credit Suisse may borrow up to $54 billion from the Swiss central bank

Credit Suisse said Thursday it plans to Get a loan 54 billion from the Swiss central bank to improve its liquidity after the lender’s shares hit a new low.

The bank will access a “short-term liquidity facility” and buy back about $3 billion in debt, it said in a statement posted on its website.

Credit Suisse, a 166-year-old firm, ended its fight for its life on Wednesday. Its shares fell 24 percent on the SIX Swiss Exchange, hitting a new low, and the price of its bonds also fell sharply. The price of financial contracts that insure against bank defaults rose to the highest level on record.

After European markets closed on Wednesday, the Swiss National Bank and FinmaFinancial Controller of the Country, published A joint statement Certifying Credit Suisse’s financial health, the central bank will shut down the bank if necessary. Hours later, Credit Suisse said it planned to borrow 50 billion Swiss francs from the Swiss National Bank.

An immediate catalyst for the dangerous fall in the bank’s share price was the opinion of Ammar Al-Qudairi, chairman of Saudi National Bank, the bank’s largest bank. Partner. In a televised interview with Bloomberg News, Mr. Al-Qudayri said the state-owned bank would not put more money into Credit Suisse.

Credit Suisse has been plagued by mistakes and controversies over the years, having lost two chief executives in three years. These include major trading losses associated with the implosions of investment firm Archigos and lender Greensil Capital; They range from being involved in money laundering to various other scandals Spying on ex-employees.

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The firm has embarked on a major turnaround plan that includes thousands of layoffs and a spinoff of its Wall Street investment bank. But investors have questioned whether the company’s loss of $147 billion worth of customer deposits in the last three months of 2022 — a combination of ongoing losses and client departures — jeopardized that effort.

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