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Deutsche Bank
Deutsche Bank shares fell by more than 11% on Friday following a spike in credit default swaps Thursday night, as concerns about the stability of European banks persisted.
The German lender's Frankfurt-listed shares retreated for a third consecutive day and have now lost more than a fifth of their value so far this month. Credit default swaps — a form of insurance for a company's bondholders against its default — leapt to 173 basis points Thursday night from 142 basis points the previous day.
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The bank notoriously pleaded guilty in 2014 to criminal charges for "knowingly and willfully" helping thousands of U.S. clients conceal their offshore assets and income from the IRS. It admitted at the time that it used sham entities, destroyed account records, and hand delivered cash to American clients to avert IRS detection — agreeing to crack down on U.S. tax dodgers going forward as part of its plea deal. Credit Suisse also agreed at the time to a host of reforms, including disclosing its cross-border activities and cooperating with authorities when they request information, among other things.
The now troubled bank appears to have violated that agreement, according to a new report by the Senate Finance Committee that details ongoing and rampant abuse since then. The report, released Wednesday, details the findings of the panel's two-year investigation and takes on more urgency given the looming banking crisis. ...
Saudi's have a way of taking care of business.How Credit Suisse lured – and then burned – the Saudi crown prince
When Credit Suisse opened its first office in Saudi Arabia in early 2021, Bruno Daher, the cigar-smoking head of Credit Suisse’s Middle East business, declared it a “key growth market”.finance.yahoo.com
Iffn you watched the video...buckle up folks!
THE AMC SWAPS DESTROYED CREDIT SUISSE!! - AMC Stock Short Squeeze Update
The AMC and Gamestop Swaps DESTROYED Credit Suisse. This is because they inherited the swaps from Archegos and inherited the massive unrealised losses, therefore to negate their losses, they SOLD put options to other hedgies hoping the price would go up and squeeze.
That way Credit Suisse would make tons from the premiums during the squeeze, negating the losses and closing out of their positions.
But because the squeeze didn't happen in June 2021, the losses on their sold puts ate away at the bank further and further until the bank went under.
10m
Iffn you watched the video...
at the 2:30 mark he plays a short piece from The Big Short that pretty much explains how the market works.
Credit Suisse reported Monday that clients had withdrawn 61.2 billion francs ($69 billion) in the first quarter and that outflows were continuing, highlighting the challenge faced by UBS in rescuing its rival in March.
In the last financial statement as an independent company, Credit Suisse reported a loss of 1.3 billion Swiss francs ($1.46 billion) for the first three months of the year. It said "significant net asset outflows" were seen in March.
Most asset outflows originated from its wealth management unit and occurred in all regions. The troubled bank said, "These outflows have moderated but have not yet reversed as of April 24, 2023."
Credit Suisse's wealth management unit lost 9% of assets in the first quarter. ...
"Magnitude Of Losses And Outflows Is Alarming:" Credit Suisse Hemorrhages $69 Billion In Assets | ZeroHedge
ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zerowww.zerohedge.com
I think you would have to have your head in a snowdrift in order to not be pulling funds out of CS by now.
... the Swiss Parliamentary Commission of Inquiry that is delving into the collapse in March of the second largest global bank in Switzerland – Credit Suisse. ... has announced that it plans to lock away the details of its findings for 50 years. (UBS, the largest global bank in Switzerland, bought the crumbling remains of Credit Suisse earlier this year.)
Reuters reported that the Swiss Parliamentary Commission of Inquiry is also requiring that “All persons participating in the meetings and the questioning are subject to the duty of secrecy, not only the members of the commission, but also the interviewees themselves.” ...
Is it time to start the "UBS on borrowed time?" thread yet?
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A Reuters poll of analysts had initially projected a net profit of $12.8 billion for the three months to the end of June. UBS smashed that with a record profit of $28.9 billion in the second quarter, thanks to $28.9 billion of negative goodwill associated with the Credit Suisse acquisition. This was possible by the accounting difference between the $3.8 billion price UBS paid for Credit Suisse and the value of the acquired lender's balance sheet. The bank expects Credit Suisse's local unit will be fully absorbed into the parent company by 2025.
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Ermotti said, "We will have around 3,000 jobs that will be made redundant over the next years." This is the first time the CEO has put solid numbers on how many jobs will be axed due to the merger of the banks. UBS' acquisition of the 167-year-old institution increased its workforce by 45,000 to 120,000. Thousands of jobs are considered "redundant" and are on the chopping block.
Ermotti told CNBC's Joumanna Bercetche:"When people look into those numbers, they will clearly understand that this negative goodwill is the equity necessary to sustain $240 billion of risk-weighted assets and the financial resources to go through a deep restructuring that is necessary at Credit Suisse, because our analysis has proven that the business model was not viable any longer."
He continued:..."Credit Suisse has excellent people, clients, and product capabilities, but the business model was not sustainable any longer and needs to be restructured."
A popular initiative in Switzerland wants to hold a vote on partially nationalizing UBS Group AG, the initiators wrote on their website.
The so-called banks initiative proposes to amend the Swiss constitution to say that “large banks of systemic importance are to be managed as joint stock companies with the confederation as majority shareholder in terms of share capital,” according to the website.
The text is currently under review by federal authorities. If they greenlight it, the initiators have 18 months to collect 100,000 signatures for their cause. Parliament and cabinet ministers would then need to weigh in before the issue could be put to a national vote, a process that would likely take several years.
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The crisis at Credit Suisse has opened up a broad debate on the financial stability framework in Switzerland. The National Bank Act states that the Swiss National Bank shall contribute to the stability of the financial system, and legislators have allocated certain tasks and instruments for this purpose. In the event of a crisis, the SNB performs this mandate in particular by acting as lender of last resort and providing liquidity to systemically important domestic banks that are solvent but can no longer refinance themselves on the market. In March 2023, the crisis at Credit Suisse placed heavy demands on the SNB in its role as lender of last resort. By making liquidity assistance available on an unprecedented scale, the SNB first created the time window necessary to find a solution for Credit Suisse, and thereafter provided significant support in the acquisition of Credit Suisse by UBS.
The acquisition of Credit Suisse by UBS on 19 March this year prevented a global financial crisis. ...
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What lessons have been learned from this crisis with regard to the provision of emergency liquidity? The case of Credit Suisse has clearly shown that outflows of customer deposits can now be much faster and more extensive than assumed by the existing regulations. Moreover, Credit Suisse had not prepared sufficient assets that it could provide to the SNB as collateral in order to access massive amounts of emergency liquidity assistance in a crisis. That is why emergency law had to be used to make ELA+ possible.
The following lessons can be learned from this: First, the liquidity regulations must be geared to the new reality of potentially faster and larger outflows of deposits. Second, it is of the utmost importance going forward that banks prepare sufficient collateral that they can transfer to the SNB and other central banks. Third, there needs to be an effective PLB that enables the SNB to provide liquidity loans to banks in difficulties that do not have sufficient collateral. The risks of the PLB are borne by the state. This approach tallies with the established allocation of roles between state and central bank in a banking crisis. ELA+ should not become part of the SNB's regular set of instruments.
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UBS Bank Branch in Basel Switzerland DENYING Withdrawals - "Liquidity Challenges"
A branch of UBS Bank, located at Tellplatz 12, Basel, Switzerland, gave a written notice to a Depositor today explaining why they CANNOT GIVE HIM HIS WITHDRAWAL: "Liquidity Challenge."
Yes, you read that right: The largest Bank in Switzerland told a Depositor IN WRITING, they cannot give him his withdrawal due to "Unforeseen liquidity challenges."
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Hmmm...
Hmmm...
UBS and Credit Suisse Agree to Merge Their Parent Banks
UBS Group AG (UBS) and Credit Suisse approve the merger between their parent banks, which is expected to be completed in 2024.finance.yahoo.com
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