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Credit Suisse executives reassure investors after CDS spike, Financial Times reports

Published 10/02/2022, 02:49 PM
Updated 10/02/2022, 03:35 PM
© Reuters. FILE PHOTO: Switzerland's national flag flies above the logo of Swiss bank Credit Suisse at its headquarters in Zurich, Switzerland April 18, 2021. REUTERS/Arnd Wiegmann

(Reuters) - Credit Suisse executives spent the weekend reassuring large clients, counterparties and investors about its liquidity and capital position, the Financial Times reported on Sunday.

A spokesman for Credit Suisse declined to comment on the report when contacted by Reuters.

Executives made the calls after spreads Credit Suisse credit default swaps (CDS), which offer protection against a company defaulting, rose sharply on Friday in an indication of investor concerns, the newspaper said.

Credit Suisse five-year credit default swaps (CDS) jumped 6 basis point to close to 247 bps on Friday, the highest level in at least 10 years, S&P Global (NYSE:SPGI) Market Intelligence data showed.

Credit Suisse CDS began the year at 57 bps.

The Financial Times said that a Credit Suisse executive denied reports that the bank had formally approached investors about potentially raising more capital, insisting that it was trying to avoid such a move with its share price at record lows and higher borrowing costs due to rating downgrades.

The Swiss bank's chief executive Ulrich Koerner told staff in a memo seen by Reuters on Friday that it has solid capital and liquidity.

The bank also said last month it was pressing ahead with a review that includes potential divestitures and asset sales.

Latest comments

For those of you with a shot (get it SHORT..LOL) memory here is the headline from 2018. Now, am I mad....absolutely NO... you see they did me a favor in 2018. I EXITED ALL GAMBLING in the US stock market and so called investment firms and made money the old fashion way. Worked for it. For your enjoyment: Credit Suisse is defending a controversial financial product it issued that played a role in staggering market losses this week, as experts question the logic behind such complex securities. The Switzerland-based bank said it is experiencing no losses from its financial instrument — known as the VelocityShares Daily Inverse VIX Short-Term exchange-traded note  (ETN), or XIV for short. Instead, it appears the fallout will be squarely borne by investors holding the product. LOL
Wait... I've seen this one before!
Don't worry... it will all be fine!
Kareem Serageldin says all is fine, nothing to worry about.
❤️❤️❤️❤️❤️❤️
I'd buy CS shares right now if I had any cash.
Lehman brothers exec said the same thing. Europe is toasty.
That is the conclusion people are going to make.  But the chances of a repeat are low.
Why? Because banks learned their lessons the last time?
Crazy ****
Woah here we go!
This will take allot of rescuing I think.
Swiss govt to the rescue🪳
Due to higher volatility in the market facing some problem by Credit Suisse, risk of default rising but no chance of default.
hope not
No chance of default
the collapse feels much closer than I thought
next is Deutsche bank
as a German I transfered everything I had to JPM
BOOM!
This smells like 2008 all over again
exactly. totally different than 2008.
 But also a lot of banks had speculative investments in Shares / Cryptocurrency which have all fallen rapidly in 2021. Or they have lent to overheated property markets  - which all look like collapsing next with Central Bank Interest rates all rising rapidly. Like a ponzi scheme all built one on top of the next in speculation.  Just look at UK Pensions after the UK 'mini Budget' - BoE had to step in with $70 Billion of bond buying to avoid UK pension industry collapse.
That is basically the bull case. The banksters and or government have to keep stepping in to prevent this global system from collapsing.
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