MILANO – The nervousness around the fate of the Swiss credit. So much so that the top managers of the group, according to reports from the Financial Times they spent the weekend on the phone, to reassure large customers, counterparties and investors that the bank is solid in terms of capital and liquidity.
The picture had worsened last Friday, when the key indicator of the group’s fragility, the cost of Credit Default Swap (Cds) closed at 255 points, compared to 55 at the beginning of the year: it is the measure of how much it costs to insure on the financial markets from the risk of default of the bank (which in the recent past had to face scandals and chain resignations), and it is at the highest values since 2009.
Last Friday the new CEO had already intervened, Ulrich Koernerin office since last July, who admitted that the bank is going through “a critical phase” and made an appointment at October 27, when a new strategic plan will be presented, but also added that the bank’s capital and liquidity position show no signs of difficulty. However, analysts, particularly those of the Kbw, believe that the Swiss institution needs a capital increase of 4 billion Swiss francs (4 billion dollars), in addition to the sale of assets and the restructuring of its businesses. Such a massive appeal would have very dilutive effects on shareholders, given that the stock market capitalization it has now fallen to 10 billion Swiss francs, while in March 2021 alone it was worth more than 30 billion.
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The financial community has speculated that the institution may launch a plan that includes cuts for thousands of employees and restructuring into three divisions, including the creation of a “bad bank”. The same bank last week did not rule out the possibility of selling his division of securitized productswhile it is considering the possibility of divesting the asset management activities of Latin America, with the exclusion of Brazil, but also to brush up on the vecchio brand First Boston.
The bank, which will announce its third quarter results later this month, closed on second quarter with a net loss of 1.59 billion francs (against a profit of 253 million the previous year) while the first quarter had recorded a loss of 273 million.