Credit Suisse Dives 15% After Reporting Biggest Loss Since The Financial Crisis

Key Insights

• Credit Suisse is under strong pressure after the disappointing earnings report. 
• Assets under management are declining at a robust pace, and the bank wants to focus on its wealth-management business. 
• Shareholders should expect more losses in 2023. 

Clients Take Their Money Out Of The Bank

Credit Suisse stock gained strong downside momentum after the release of the company’s quarterly report.

Credit Suisse reported a loss of $1.5 billion, the company’s biggest loss since the global financial crisis. The company recorded outflows of $120 billion in the fourth quarter as clients took their funds elsewhere. Assets under management declined from $802 billion at the start of 2022 to $583 billion at December 31, 2022.

The bank blamed rumors about its financial health, which were actively circulating in October 2022, for the rapid decline of its assets under management.

Credit Suisse plans to focus on its wealth-management business. However, it does not expect fast progress, so the company’s shareholders should expect a tough 2023.

Credit Suisse Stock Is Trading Near Multi-Decade Lows

Credit Suisse, which is one of the biggest Switzerland’s banks, has never recovered from the 2008 financial crisis. The company’s shares touched highs near the $77.50 level in 2007 and have been moving lower for many years.

Big bank stocks like JPMorgan, Bank of America, and Citigroup are moving lower today, but this move is not related to the disappointing performance of Credit Suisse.

The market believes that the problems of Credit Suisse are isolated and do not reflect the general situation in the industry. At the same time, traders stay cautious amid recession worries.

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