The EU banking system is in worse shape than the U.S. banking system and Credit Suisse is the EU poster child. For the disturbing details, put Alasdair Macleod in the SLL search function and start reading. From Tyler Durden at zerohedge.com:
- Saudis fold – refuse to throw any more money at Credit Suisse
- Credit Suisse stock hits record low
- Credit Suisse 1Y CDS explodes as counterparty risk hedging soars
- Credit Suisse execs urged a “show of confidence” from the Swiss National Bank
- ECB quantifying exposures to Credit Suisse
- US Treasury monitoring situation, talking with other regulators
- Fed working with UST to quantify exposures
- One major govt is pressuring Swiss to intervene
- Systemic risk threat spreads globally
- Swiss authorities seeking to stabilize bank
- Swiss National Bank and Finma issue statement of support
- Credit Suisse said it’s planning to borrow from the Swiss National Bank up to CHF50 billion under a covered loan facility.
Update (21:00ET): And so, the “bailout” arrives just a few hours before the Europe open, Credit Suisse said it’s planning to borrow from the Swiss National Bank up to CHF50 billion ($54 billion) under a covered loan facility which is “fully collateralized by high quality assets”. It wasn’t immediately clear what high quality assets CS has left to pledge but in a time of BTFP, we are confident they found something.
The bank also announced offers by Credit Suisse International to repurchase certain OpCo senior debt securities for cash of up to about CHF3 billion, which will help the bank pick up a few pennies in bond discount, even as it faces tens of billions in deposit flight.
the swiss (small letter intended) threw over their well deserved reputation for allowing individuals to deposit assets and prevent depredation by govts to become a partner with such governments. their reputation then suffered.
i wonder how their bankers now feel being part of the corrupt west and its destructive nature. now their banks are suffering.
first, the reputation. now, the institutions themselves. so be it. they deserve neither tears, nor compassion. they did this to themselves and deserve to pay the price.