SWITZERLAND: The world’s largest bank in Switzerland reported that 61.2 billion Swiss francs (£55.2 billion; $68.6 billion) departed the institution in the first three months of the year, likely as part of its forced sale to UBS.
Credit Suisse reported a 29% decrease in assets under administration at its flagship wealth management division to 502.5 billion Swiss francs at the end of March, compared to last year.
Credit Suisse customers began withdrawing money from the bank due to market turbulence, leading to a rescue plan by Swiss authorities. UBS agreed to acquire Credit Suisse, and financial guarantees totalling 200 billion Swiss francs were included.
The bank has been losing money and dealing with accusations of money laundering, resulting in a deficit of 7.3 billion Swiss francs in 2022, its worst financial year since 2008.
The demise of Silicon Valley Bank and Signature Bank in the US follows a decline in asset value due to rising interest rates. M&G Wealth Investments’ Shanti Kelemen believes UBS has purchased the bank.
Investors rushed to remove their money from Credit Suisse due to concerns about other lenders, but Ms Coppola warned that there may still be issues with others.
The takeover of Credit Suisse has been opened up for investigation by Swiss authorities, which could lead to further instability in the banking sector. It is still being determined if this will impact large institutions.
Taxpayers and bank shareholders who were denied the opportunity to vote on the acquisition are outraged by the agreement, which has hurt Switzerland’s standing as a financial hub.
Credit Suisse was valued at $3.15 billion when it was first revealed, compared to an $8 billion valuation on the Friday before the settlement was agreed.
Also Read: Sergio Ermotti Rejoins UBS as CEO: Swiss Banker to Lead the Takeover of Credit Suisse
