The Swiss National Bank (SNB) indicated Wednesday it would step in to back Credit Suisse if such a move became necessary.
The SNB and Swiss Financial Market Supervisory Authority (FINMA) noted in a statement that Credit Suisse shares and debt securities "have been particularly affected by market reactions" in the past few days.
"Against this background, FINMA confirms that Credit Suisse meets the higher capital and liquidity requirements applicable to systemically important banks. In addition, the SNB will provide liquidity to the globally active bank if necessary," the Swiss entities said.
Credit Suisse’s stock hit record-low levels earlier this week and has since fallen even further than that.
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On Wednesday, one of the bank’s investors, Saudi National Bank, said it would not move to go above its current stake in Credit Suisse because "it’s a regulatory issue," according to Reuters.
Credit Suisse, in an annual report, said the prior day that "certain material weaknesses in our internal controls over financial reporting" had been detected, leading management to describe those controls as "not effective" for 2021 and 2022. However, its financial results "for 2022 and preceding years are accurate and reliable," something the bank said Tuesday was "supported by a clean audit opinion" by its external auditor.
The bank tweeted Wednesday it "welcome[s] the statement of support issued by" SNB and FINMA.
Earlier in the day, it had said in a tweet that it was "reiterating its core financials." It also highlighted an interview its CEO, Ulrich Korner, gave to a Singapore news outlet in which he said, "Our capital, our liquidity basis is very strong."
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SNB and FINMA also said the "problems of certain banks" in the U.S. "do not pose a direct risk of contagion for the Swiss financial markets."
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That appears to reference Silicon Valley Bank and Signature Bank, which the U.S. Federal Deposit Insurance Corporation (FDIC) took over Friday and Sunday, respectively. Those bank collapses were followed by turbulence in the market, particularly among some banking stocks.
Credit Suisse’s stock price closed at $2.16 Wednesday afternoon, marking a nearly 14% plunge from what it was at the end of the prior day’s U.S. trading.
