Credit Suisse falls 29% as Saudi investor rules out funds
In the latest blow to Credit Suisse, its largest shareholder Saudi National Bank ruled out more financial assistance to the struggling bank. Following the news, the embattled Swiss lender's stocks crashed by over 29%, hitting another record low for a second consecutive day. Once a major player, Credit Suisse has been dogged by a series of missteps and compliance issues.
Saudi National Bank cited regulatory and statutory reasons
Speaking to Bloomberg, Saudi National Bank's chairman Ammar Al Khudairy said the bank would not increase its stake in the Swiss lender. "The answer is absolutely not, for many reasons. I'll cite the simplest reason, which is regulatory and statutory," he said. "We cannot because we would go above 10%. It's a regulatory issue," he later told Reuters.
Credit Suisse's shares fell below 2 Swiss Francs
Credit Suisse's shares have been taking a beating in the market after Khudairy's statement. At the time of writing, the lender's shares have fallen by 29.08%. The bank's share price has fallen below 2 Swiss Francs for the first time. It is currently trading at 1.59 Swiss Francs. The stock exchange operator halted trading in shares multiple times.
Saudi National Bank is pleased with Credit Suisse's restructuring plan
Credit Suisse has been struggling for a while. Last October, the lender laid off 9,000 employees as part of a restructuring plan. "We are happy with the plan, the transformation plan that they have put forward. It is a very strong bank," Khudairy said. "I don't think they will need extra money; if you look at their ratios, they're fine," he added.
Index of European banks fell by over 6%
European bank stocks generally struggled on Wednesday owing to the fear of contagion after the collapse of the Silicon Valley Bank and Signature Bank. STXE 600 BNK PR Index, an index of European banks, fell in morning trade and was last down at 6.9%.