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And More October 3, 2022 2 mins read

Credit Suisse Stock Rebounds After a 10% Loss during the Monday trading Session

And More ı By Rochdi Rais

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credit suisse

Shares of Credit Suisse rebounded, ending the Monday trading session down around 1% after a big market rally.

The shares had fallen as much as 10% at the start of trading after the Financial Times reported the Swiss bank’s executives are in talks with its major investors to reassure them amid rising concerns over the lender’s financial health.

In a statement to CNBC on Monday, the bank said it will provide updates on its strategy review when it releases its third-quarter results, scheduled for Oct. 27.

“It would be premature to comment on any potential outcomes before then,” it said.

The stock is down about 60% year to date.

“I trust that you are not confusing our day-to-day stock price performance with the strong capital base and liquidity position of the bank,” the CEO said in a separate staff memo obtained by CNBC.

The FT said the executive denied reports that the Swiss lender had formally discussed with investors the possibility of raising more capital, and insisted Credit Suisse “was trying to avoid such a move with its share price at record lows and higher borrowing costs due to rating downgrades.”

The bank told Reuters that it’s in the process of a strategy review that includes potential divestitures and asset sales.

The latest from Credit Suisse signals a “rocky period” ahead but it could lead to a change in the U.S. Federal Reserve’s direction, John Vail, chief global strategist at Nikko Asset Management, said Monday on CNBC’s “Squawk Box Asia.”

“The silver lining at end of this period is the fact that central banks will probably start to relent some time as both inflation is down and financial conditions worsen dramatically,” Vail said. “I don’t think it’s the end of the world.”

“We struggle to see something systemic,” analysts at Citi said a report about the possible “contagion impact” on U.S. banks by “a large European bank.” The analysts did not name Credit Suisse.

“We understand the nature of the concerns, but the current situation is night and day from 2007 as the balance sheets are fundamentally different in terms of capital and liquidity,” the report said, referring to the financial crisis that unraveled in 2007.

“We believe the U.S. bank stocks are very attractive here,” the report said.

 

 

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Rochdi Rais

Rochdi Rais is the Head of Growth and financial and legal writer at USA Herald. He has been writing and editing financial, legal and U.S. news for years with over +4000 articles published during his career.

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