Tag: SVB Bank News

Credit Suisse Was Bailed but Clients Keep Pulling Out Money

Market News Daily: Credit Suisse Bank News Today.
Market News Daily: Credit Suisse Bank News Today.

Credit Suisse is trying to lure investments from wealthy clients in Asia by offering higher deposit rates than its competitors, Reuters has reported citing people familiar with the development.

Sources said the offers are valid until the end of this quarter and only apply to new cash deposits, not to existing portfolios.

The Swiss National Bank and Finma, the top financial regulator in Switzerland, said Credit Suisse “meets the higher capital and liquidity requirements applicable to systemically important banks.”

The regulators didn’t provide details of what type of liquidity they would offer, but said they are in very close contact with the bank.

“If regulators do not handle the Credit Suisse situation well, this will send shock waves through the whole sector,” said Joost Beaumont, head of bank research at Dutch lender ABN Amro.

Credit Suisse has been the problem child of European banking for several years.

Repeated scandals and financial losses have hammered the 166-year-old bank, which combines a wealth-management business catering to the world’s elite rich with a Wall Street investment bank. 

The bank is classified as a “systemically important financial institution” under international banking rules created after the collapse of Lehman Brothers.

Such designations require the bank to hold higher amounts of capital and to maintain plans for an orderly unwinding of its operations in case it gets into trouble. 

Like Silicon Valley Bank, Credit Suisse has suffered large deposit outflows in recent quarters.

Some local units briefly breached regulatory liquidity coverage ratios last fall.

That means they weren’t holding enough easy-to-sell assets, such as bonds, to safely cover customer withdrawals.

Top 4 Wall Street Banks See Big Losses

Wall Street’s 4 top banks just had $55 billion wiped off their market value in a single day.

Four of America’s biggest banks lost a combined $55 billion of market value in a single day as financial stocks plunged.

US bank shares took a beating amid fears of contagion effects from the turmoil at Silicon Valley Bank and Silvergate.

 JPMorgan Chase, Bank of AmericaWells Fargo and Morgan Stanley – the four most valued US lenders – saw $55 billion wiped off their combined market capitalization last Thursday, Refinitiv data show.

JPMorgan, the biggest US bank, alone saw a $22 billion tumble in its market value as its stock slid 5.41% to $130.34.

Wall Street’s Bank of America lost $16.16 billion as its share price fell 6.20% to $30.54.

Wells Fargo and Morgan Stanley saw their market capitalization drop by $10.3 billion and $6.2 billion, respectively.

Among other major US banks, Goldman Sachs and Citi also witnessed significant declines in their share prices.

Credit Suisse Warned Investors of Potential Losses in Q4 of 2022

Market News Daily: Credit Suisse Bank News Today.
Market News Daily: Credit Suisse Bank News Today.

The SEC released Credit Suisse’s 6-K filing where the bank warns investors of potential losses due to naked short covering, more on that below.

Credit Suisse (CS) took a massive hit of $4.09 billion in Q3 and hinted at occurring losses in an upturn in markets — something we saw at the start of 2023.

The bank proceeded to hire 20 banks for a $4 billion injection in effort to pivot from Q3’s disaster.

In a statement, the bank says, “Conversely, to the extent that we have sold assets that we do not own, or have net short positions, in any of those markets, an upturn in those markets could expose us to potentially significant losses as we attempt to cover our net short positions by acquiring assets in a rising market.

“Market fluctuations, downturns and volatility can adversely affect the fair value of our positions and our results of operations.

Adverse market or economic conditions or trends have caused, and in the future may cause, a significant decline in our net revenues and profitability.”

The closing of naked shorts this year would send affected securities soaring as buying momentum compounds.

Credit Suisse recently postponed publication of its annual report after a last-minute call from the United States Securities and Exchange Commission (SEC), which raised questions about its earlier financial statements.

The unusual intervention by the U.S regulator is the latest blow to Credit Suisse as it attempts to rebuild investor confidence after a series of scandals and setbacks that have sent its shares plunging and led clients to withdraw billions, per Reuters.

Market News Published Daily

Market News Daily: Credit Suisse Bank News Today.
Market News Daily: Credit Suisse Bank News Today.

For stock market, business news and updates, join the newsletter to receive weekly market news and notifications straight to your inbox.

Franknez.com is the media site that keeps retail investors informed.

You can also follow Frank Nez on TwitterInstagramFacebook, or LinkedIn for daily posts.


Franknez.com

You can now read exclusive FrankNez articles for only $1/mo.

  • Gain access to EXCLUSIVE FrankNez articles you won’t find here.
  • Become part of a private and safe Discord community, just for retail investors.
  • Get drawn at the end of the year for holiday giveaways.

My New Book is Out Now! Use Code: THENEZ


SVB Distributed Bonuses Hours Before Bank Collapsed

Banking News: SVB gave company-wide bonuses hours before it collapsed.
Banking News: SVB gave company-wide bonuses hours before it collapsed.

Silicon Valley Bank employees received their annual bonuses on Friday just hours before the government took control of the company, according to Fox Business.

The Santa Clara, California-based band collapsed last week and is now under the control of federal regulators.

SVB had been the 16th-largest bank in the U.S. prior to the bank run that led to its downfall.

The bank held a reputation as a go-to for a number of Silicon Valley industries and startups.

Y Combinator, an incubator startup that launched Airbnb, DoorDash and DropBox, regularly referred entrepreneurs to them.

SVB’s collapse was so quick that, hours before its closure, some industry analysts were hopeful that the bank was still a good investment.

The bank’s shares had fallen by 60% on Friday morning after a similar drop the day before. 

Anxious depositors rushed to withdraw their money over concern for the bank’s health, causing its collapse, which may serve as “an extinction-level event for startups,” according to Y Combinator CEO Garry Tan.

Entrepreneur and Dallas Mavericks owner Mark Cuban called for federal regulators to buy out the bank earlier on Friday.

“The Fed should IMMEDIATELY buy all the securities/debt the bank owns at near par, which should be enough to cover most deposits,” Cuban wrote as part of a lengthy Twitter chain last week. “Any losses paid for in equity and new debt from the new bank or whoever buys it. The Fed knew this was a risk. They should own it.” 

SVB traditionally processes annual bonuses on the second Friday of March, unnamed sources associated with the bank told CNBC.

The bonuses were reportedly for work completed in 2022.

Banking News: Wall Street Banks Face Distress

Silicon Valley Bank (SVB) isn’t the only bank experiencing serious distress.

Wall Street banks lost $55 billion in just one day last week.

Four of America’s biggest banks lost a combined $55 billion of market value in a single day as financial stocks plunged.

US bank shares took a beating Thursday amid fears of contagion effects from the turmoil at Silicon Valley Bank and Silvergate.

JPMorgan saw the biggest tumble in market value among US lenders, losing $22 billion. 

(Markets Insider) JPMorgan Chase, Bank of AmericaWells Fargo and Morgan Stanley – the four most valued US lenders – saw $55 billion wiped off their combined market capitalization on Thursday, Refinitiv data show.

JPMorgan, the biggest US bank, alone saw a $22 billion tumble in its market value as its stock slid 5.41% to $130.34.

Wall Street’s Bank of America lost $16.16 billion as its share price fell 6.20% to $30.54.

Wells Fargo and Morgan Stanley saw their market capitalization drop by $10.3 billion and $6.2 billion, respectively.

Credit Suisse Bank Sees Billions in Withdraws

Credit Suisse (NYSE:CS) clients have withdrawn billions of dollars in the past several months.

In November, the bank warned investors in a 6-K filing of potential losses due to naked short covering, which as scared investors from losing most if not all of their money.

Credit Suisse also took a massive hit of $4.09 billion in Q3 and hinted at occurring losses in an upturn in markets.

This has fueled widespread withdraws from the bank leading it to borrow money.

The bank hired 20 banks for a $4 billion injection in effort to pivot from Q3’s disaster.

Credit Suisse has postponed publication of its annual report after a last-minute call from the United States Securities and Exchange Commission (SEC), which raised questions about its earlier financial statements.

The unusual intervention by the U.S regulator is the latest blow to Credit Suisse as it attempts to rebuild investor confidence after a series of scandals and setbacks that have sent its shares plunging and led clients to withdraw billions.

Market News Published Daily

Banking News: SVB gave company-wide bonuses hours before it collapsed.
Banking News: SVB gave company-wide bonuses hours before it collapsed | SVB News.

For stock market, business news and updates, join the newsletter to receive weekly market news and notifications straight to your inbox.

Franknez.com is the media site that keeps retail investors informed.

You can also follow Frank Nez on TwitterInstagramFacebook, or LinkedIn for daily posts.


Franknez.com

You can now read exclusive FrankNez articles for only $1/mo.

  • Gain access to EXCLUSIVE FrankNez articles you won’t find here.
  • Become part of a private and safe Discord community, just for retail investors.
  • Get drawn at the end of the year for holiday giveaways.

My New Book is Out Now! Use Code: THENEZ


© 2024 FrankNez

Theme by Anders NorenUp ↑