Credit Suisse sinks after the Saudis' no to bailout, stock exchanges in free fall: what's going on - Corriere.it

Credit Suisse sinks after the Saudis' no to bailout, stock exchanges in free fall: what's going on - Corriere.it


Market confidence fragile after the Svb crash

Unlike Silicon Valley Bank, Credit Suisse does not appear to be subject - at least at the moment - to a rush by creditors and depositors to withdraw their exposures. But market confidence is fragile and the institute has substantial dimensions: a balance sheet with liabilities of 486 billion Swiss francs (525 billion euros) at the end of 2022 and a market capitalization now reduced to only 7 billion. Spreads on Credit Suisse's credit default swaps, derivatives that insure against a debtor's insolvency, rose from 350 basis points (3.5%) at the beginning of the month to 565 now: the market is charging more bank insolvency insurance. Its stock has already fallen 39% since the last day of February.

The stock market crash

The stock market contagion on the banks immediately resumed this morning. Deutsche lost 8.9% in the middle of the day, Unicredit 7.3% and Société Générale 11.9%. Futures are also pointing lower before the reopening of markets in the United States. Contagion on the banking sector was smoldering. And now it has re-emerged in the sunlight, awaiting the decisions of the European Central Bank and the Federal Reserve in the coming days.



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