The cautious stance adopted by Credit Suisse’s rivals comes after the Swiss central bank threw a lifeline to the lender after its shares were pummeled in the aftermath of the US banking crisis this week. The curbs add to the bank’s problems as it tries to restructure operations and find its footing after a series of costly scandals.
These five people with direct knowledge of the matter requested anonymity because of the sensitivity of the situation. Société Générale is not increasing counterparty positions with the Swiss lender, according to two sources with direct knowledge of the situation, while Deutsche Bank has slashed the lending value it assigns to Credit Suisse securities, such as bonds, put up by its wealth management clients as collateral for loans.
HSBC’s private banking business has also started scrutinising its loans linked to Credit Suisse securities, a source with direct knowledge of the matter said. The source added that the bank has not taken any decision yet on lowering its exposure to the Swiss lender.
And shares in First Republic Bank tumbled yet again on Friday after a financial lifeline from large US banks that deposited $30 billion into its accounts failed to calm investor fears. – Reuters/The Financial Times Limited 2023