Shares of Credit Suisse (CS) plunged to all-time lows Wednesday after the bank's largest shareholder indicated it would not increase its holdings, fueling more turmoil in the global banking industry already shaken by the collapse of Silicon Valley Bank and Signature Bank.
American Depositary Receipts (ADRs) of Credit Suisse Group (CS) plunged up to 30% in early trading Wednesday before recovering some of their losses. The chair of Saudi National Bank, the bank's largest shareholder which took a 9.9% stake in Credit Suisse last year, said in an interview his firm would "absolutely not" go above that level "for many reasons."
After the precipitous drop, the Treasury Department is allegedly working with American and European regulators to investigate U.S. banks' exposure to Credit Suisse, Bloomberg reported.
Credit Suisse had already been reeling following its announcement yesterday that it had found "material weaknesses" in its 2021 and 2022 financial reporting. That revelation came in the bank’s annual report, which had been scheduled for release last Thursday but was delayed after Credit Suisse received a call late Wednesday from the Securities and Exchange Commission (SEC). It explained the SEC conversation was related to "technical assessment of previously disclosed revisions to the consolidated cash flow statements in the years ended December 31, 2020, and 2019, as well as related controls."
Not Like the U.S.
CEO Ulrich Körner called for patience, telling a conference the bank’s financial position is sound, and the problems at Credit Suisse aren’t comparable to the severe liquidity issues hitting smaller banks in the U.S.
ADRs of Credit Suisse (CS) have lost about a third of their value in the past week and are trading at an all-time low. Shares of the beleaguered lender are 97% off their all-time highs from before the global financial crisis.