Swiss credit,
Mar 10, 13:59
Credit Suisse shares hit new all-time low after US bank collapse
In addition to Credit Suisse, shares of other European banks also suffered. EURO STOXX Banks sectoral index lost 4.89% at the low of the day
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Shares of Credit Suisse at auction on the Swiss Stock Exchange (SIX) on Friday, March 10, updated their historical low against the backdrop of a sell-off in the papers of the American banking sector. At the moment, quotes fell by 6.1% to 2.463 Swiss francs (about $2.65). By 13:07 Moscow time, the price of securities recovered to 2.526 Swiss francs ($2.72), but this is still 3.7% below the close of the previous trading session.
Papers of another Swiss bank – UBS – during the trading session on March 10 at a minimum fell by 5.43%. The sectoral index EURO STOXX Banks lost 4.89% at the moment.
Shares of European banks fell following the collapse in the US banking sector. So, according to the results of trading on Thursday, March 9, the S&P 500 Financials index collapsed by 4.1%, which was the maximum one-day drop since mid-2020. Shares of Bank of America fell 6.2%, Wells Fargo – 6.2%, JPMorgan Chase – 5.4%. Papers of other major US banks also fell sharply.
The sell-off in the sector came on news of the difficulties of SVB Financial Group, the holding company of Silicon Valley Bank, which serves high-growth start-ups in the technology and life sciences industries.
SVB Financial announced an emergency sale of $21 billion in bonds from its portfolio, resulting in a loss of $1.8 billion. The financial company also announced its intention to place shares for $2.25 billion to raise funds to cover losses. As a result of trading on March 9, the shares of SVB Financial Group collapsed by 60.4%.
During the period of low rates in the US, Silicon Valley Bank rapidly increased operations. However, after tightening monetary policy in the country, the bank faced serious difficulties: a decline in venture capital funding, problems from clients, as well as losses on investments made during a period of low rates.
In addition, the negative attention to the banking sector was rendered by the decision of Silvergate Capital Corp. liquidate her Silvergate Bank, which worked with cryptocurrencies. Shares of Silvergate Capital after this news collapsed by 42%.
Shares of Credit Suisse bank fell after a delay in the publication of financial statements
Against the backdrop of these events, fears about the prospects of other banks intensified on the market. Shares of Credit Suisse, for their part, have recently hit new lows amid financial difficulties and bank-related scandals. In February, the Swiss lender announced that it had posted a record loss since 2008 in 2022. The bank also warned that significant losses would continue in 2023. After that, its quotes on the Swiss stock exchange collapsed by 14.7%.
Marina Anufrieva, Valentina Gavrikova.
