The recent news of the Saudi National Bank’s refusal to provide aid to Credit Suisse has left the fate of the Swiss bank uncertain. The Swiss bank has been struggling for some time now, and this latest development has only added to its woes.
Analysis of Credit Suisse’s Financial Standing
The Swiss bank has been facing multiple challenges in recent years. It has been grappling with regulatory fines, legal issues, and restructuring costs, all of which have impacted its profitability. In 2022, according to its media release, the bank saw net revenues decrease by 34% year on year, driven by a decline in IB net revenues, down 55% on a USD basis, and a decline in WM net revenues, down 30%.
The bank also saw a decrease in AM net revenues, down 14% year on year, and in SB revenues which were down 5% year on year. They reported net revenues of CHF 14.9 bn including real estate gains of CHF 368 mn and a valuation loss of CHF 586 mn related to equity investment in Allfunds Group.
The Refusal of the Saudi National Bank to Provide Aid to the Swiss Bank
The Saudi bank holds a 9.88% stake in Credit Suisse, according to Refinitiv data. The refusal of the bank to provide aid to the Swiss bank has added to the bank’s troubles. The bank was reportedly seeking a loan from the Saudi National to shore up its finances. However, the Saudi National declined the request, citing concerns about the bank’s risk management.
Possible Scenarios for Credit Suisse’s Future
The bank’s future is uncertain, and there are several possible scenarios that could play out. One scenario is that the bank could continue to struggle and eventually be forced to sell off assets or even be acquired by another bank. This would be a significant blow to the bank’s employees and shareholders.
The refusal of the Saudi National to provide aid has only added to the bank’s troubles. Credit Suisse has been facing multiple challenges in recent years, and the bank’s financial standing has been severely impacted.