Credit Suisse's Decade-Long Struggle

Credit Suisse, the second-largest asset manager in Switzerland, has had a tumultuous decade. The bank has faced a myriad of issues, including scandals, legal problems, and leadership changes. While the bank has attempted to recover from these problems, recent events have cast doubt on its ability to do so.

One of the latest blows to Credit Suisse was the announcement by its biggest shareholder, the Saudi National Bank, that it would not be increasing its stake in the bank due to regulatory constraints. This news resulted in a significant drop in the bank's stock price. As a result, banks that trade with Credit Suisse are buying credit-default swaps to protect themselves from any further negative impact on the bank's fortunes.

Demand for these insurance contracts has skyrocketed, with levels unseen since the financial crisis. In fact, BNP Paribas has informed clients that it will no longer accept requests to take over their derivatives contracts when Credit Suisse is the counterparty. These developments are worrying signs for the bank and suggest that its issues may be far from over.

Furthermore, Credit Suisse's stock prices have been in a downtrend since the global financial crisis, with lower highs and lower lows spanning a decade. This decline suggests that the bank has been unable to turn its fortunes around and could continue to struggle.

However, not all hope is lost for Credit Suisse. The Swiss National Bank recently announced that it views the bank as systemically important and will provide liquidity if necessary. While this announcement hasn't had a significant impact on the bank's stock prices, it does provide some assurance that the bank won't fail entirely.

Overall, Credit Suisse's decade-long struggle is a cautionary tale for other banks. The bank's inability to recover from its various issues is a reminder that once a bank loses its reputation, it can be challenging to regain it. While the Swiss National Bank's support may provide some reprieve, Credit Suisse will need to take significant steps to address its problems and regain investors' confidence.