Credit Suisse shares have plunged more than 20% to record lows after its largest shareholder, Saudi National Bank (SNB), said it would not be able to stump up more cash for the beleaguered Swiss bank because of regulatory restrictions.
SNB’s chair, Ammar al-Khudairy, said he would not be able to spend any more money to support Credit Suisse, since the Middle Eastern lender had already accumulated a 9.9% stake. “Well, we can’t … We cannot because we would go above 10%,” he told Reuters in an interview.
However, Khudairy said he did not believe Credit Suisse would need a fresh capital injection. “I don’t think they will need extra money; if you look at their ratios, they’re fine. And they operate under a strong regulatory regime in Switzerland and in other countries,” he said on the sidelines of a conference in Riyadh.
However, the prospect of limits on cash from white knight investors from the Middle East still spooked markets, sending Credit Suisse shares down more than 15% to a record low of 1.73 Swiss francs a share, before trading was halted. Investors also sold European banking stocks, which have already been battered this week after Silicon Valley Bank’s collapse.
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