says the new liquidity lifeline agreed with Swiss authorities overnight “should prevent another Lehman moment”.It has been undergoing a major restructuring, slashing thousands of jobs, shrinking its investment bank and focusing more on wealth management but this has done little to assuage the bears. The events of this week catalysed another major sell-off in the stock, raising concerns about the existential future of the bank, causing a painful ripple effect across broader markets.
Thankfully, there appears to be a lifeline for the beleaguered lender, which should prevent another Lehman moment, much to the relief of markets and Credit Suisse’s investors. The bank which has been around since 1856 has been instrumental in supporting growth of the Swiss economy with the SNB clearly judging that the bank’s systemic important overrides any moral hazard argument.
The collapse of SVB bank coupled with the turmoil at Credit Suisse have created “a perfect storm” for the financial sector which has been in disarray over the past week,The Stoxx 600 banks index in Europe has shed more than 14.5% over the past five trading days until Wednesday’s close while Credit Suisse’s losses spiralled. However the sector look poised for a major rebound this morning.
The ponzu scheme is cracking