Problems at the major Swiss bank Credit Suisse (CS) pushed the shares of US financial institutions back into the red after a breather on Tuesday. The announcement on Wednesday that the new CS major shareholder Saudi National Bank could not inject fresh funds for regulatory reasons apparently revived fears of the consequences of the collapse of California’s Silicon Valley Bank (SVB). Big money houses like JP Morgan, Citigroup and Bank of America fell between 1.2 and 2.3 percent in premarket trading on Wall Street. Smaller financial institutions such as First Republic, Peers Western Alliance and PacWest lost between 0.4 and six percent.
“The markets are wild. We are moving from the problems of American banks to those of European banks, most notably Credit Suisse,” said Carlo Franchini, head of Banca Ifigest’s commercial banking division. Shares in the major Swiss bank fell by around 30 percent to a record low of CHF 1.57. The troubles at the Swiss lender helped send the European banking index to its lowest level since early January.