What about the systemically important bank Credit Suisse? The answer to this question has changed from hour to hour. A condition that creates anything but trust. Trust that the bank urgently needs in the current crisis. A crisis that is home-made, but which is exacerbated by external circumstances, such as the US regional bank crisis.
The new leadership does not have to take responsibility for the home-grown crisis. Because the damage was done by the predecessors. Namely Urs Rohner, who was Vice-Chairman of the Board of Directors from 2009 and from April 2011 he held the presidency and thus the ultimate responsibility.
The new leadership under Axel Lehmann as President and Ulrich Körner as CEO represent a fresh start. But the two must be held accountable for the communicative debacle that continues to this day.
A bad setback
We have known since Thursday night at 1:47 a.m. that the bank has suffered a major setback on its long journey back to the success it had hoped for. In order to strengthen liquidity, the bank will raise up to 50 billion francs from the Swiss National Bank (SNB), it said in a statement from CS at the time.
Just a few hours earlier, the SNB and the financial market regulator Finma were still trying to calm things down. On Wednesday at 8:20 p.m. they announced that Credit Suisse “meets the special capital and liquidity requirements for systemically important banks”. The SNB will help the bank if necessary.
State aid was “not an issue” in the morning
The statement by CS Chairman Axel Lehmann on Wednesday morning in Saudi Arabia that state aid was “not an issue” is already outdated. And reinforces the impression that the CS top say what their customers and shareholders wanted to hear.
It is not yet known what made the lightning rescue necessary a few hours after this statement. This also fuels speculation. Was it an accelerated cash outflow? Was it a refusal by other banks to work with CS as a counterparty? Or was it even greater mistrust on the part of investors?
SNB cash injection buys time
So far, the big bank has mainly been the world champion in comforting: give us time to implement the new strategy, it said. Now, at a new low, the comforting tactic no longer works. Only transparency can create trust. Especially at a time when every negative report from the banking sector hits CS twice or three times.
The SNB rescue managed to calm investors down a bit, at least for the short term. The stock was up sharply at the start of trading, recouping yesterday’s losses.
However, the decisive factor for the long-term existence of the bank will be whether the remaining customers remain loyal to the bank. With the SNB’s cash injection, the bank has gained one thing above all: time. Gained time to establish trust.