Credit Suisse Shares Up After Borrowing $54 Billion From Swiss National Bank

Facade of Swiss bank with Swiss flag, Bank Building of Credit Suisse, Bahnhofstrasse, Zurich, Canton of Zurich, Switzerland
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Credit Suisse (CS) shares remade much of the ground lost yesterday after the firm said it will borrow CHF 50 billion (about $54 billion) from Swiss National Bank to avert a liquidity crisis.

It announced the plan hours after a show of support from Swiss authorities, and shares jumped 20% after plunging 24% the day prior.

"This additional liquidity would support Credit Suisse’s core businesses and clients as Credit Suisse takes the necessary steps to create a simpler and more focused bank built around client needs," the company said.

Credit Suisse has also offered to buy back up to $2.5 billion of dollar-denominated debt and 500 million euros ($530 million) worth of euro-denominated debt.

"The transactions are consistent with our proactive approach to managing our overall liability composition and optimizing interest expense and allow us to take advantage of current trading levels to repurchase debt at attractive prices," the company said.

The Zurich-based lender admitted to "material weaknesses" in internal controls and financial reporting in its 2022 annual report released Monday. Since then, Credit Suisse shares and its American Depository Receipt listed in the U.S. lost value over liquidity concerns.

Investor confidence took a further beating on Wednesday after Credit Suisse's largest shareholder, Saudi National Bank, refused to come to its aid. Credit Suisse ADRs closed down 14% in trade.

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  1. Credit Suisse. "Credit Suisse Group takes decisive action to pre-emptively strengthen liquidity and announces public tender offers for debt securities."

  2. Reuters. "Credit Suisse's biggest backer says can't put up more cash; share down by a fifth."