Credit Suisse has been dogged by problems for years. In fact, it faced rumors of a potential collapse as recently as late last year.
In October, social media chatter that the Swiss bank was on the brink of going bust sent shares on a wild ride.
It also appeared to cost the firm dearly: Customers withdrew 111 billion Swiss francs ($121 billion) in the final three months of 2022 amid the speculation.
Credit Suisse has since embarked on a massive turnaround plan that will see it slash 9,000 full-time jobs by the end of 2025. The firm will also spin off its investment bank and focus more on wealth management.
But last month, the Zurich-based lender reported its biggest annual loss since the financial crisis in 2008, highlighting the scale of the challenge it continues to face.
It lost 7.3 billion Swiss francs ($7.9 billion) in 2022, compared to a loss of 8.2 billion Swiss francs ($8.9 billion) in 2008.
The dismal results followed a series of missteps and compliance failures that have already cost the bank dearly.
For example, the collapse of US hedge fund Archegos Capital Management, a client of Credit Suisse, in 2021 cost the bank $5.5 billion. An independent external investigation later found “a failure to effectively manage risk.”
Last year, the bank’s chairman also resigned following an investigation commissioned by the board that reportedly looked at claims that he broke Covid-19 rules. The inquiry was said to focus on conduct including travel and his personal use of corporate aircraft.
The bank’s reputation has also been marred by a spying scandal in recent years, which ultimately led to the resignation of its former CEO and COO.
New deal: Credit Suisse said Wednesday it would borrow up to 50 billion Swiss Francs ($53.7 billion) from the Swiss National Bank, as it seeks to reassure investors it has the necessary cash to stay afloat. Investors sent shares in the country’s second biggest lender crashing by as much as 30% Wednesday.