Credit Suisse Bank CEO memo, intended to flicker some hope about the struggling major bank, did not go well.
At a time when the CEO and other top leaders are planning a shift in strategy to steer the bank in better directions, the memo seemed to have raised the alarm.
The bank is now struggling to convince its investors, partners and clients about its ‘strong’ liquidity and capital position.
In the memo, CEO Ulrich Koerner told staff,
“No doubt there will be more noise in the markets and the press between now and the end of October. All I can tell you is to remain disciplined and stay as close as ever to your clients and colleagues.
I know it’s not easy to remain focused amid the many stories you read in the media – in particular, given the many factually inaccurate statements being made. That said, I trust that you are not confusing our day-to-day stock price performance with the strong capital base and liquidity position of the bank.”
Transformation Plans Or Going Down?
The memo erupted concerns that Credit Suisse bank was going bankrupt rather than calm the conditions that the bank was already facing.
Scandals like the Bulgarian Money Laundering, Mozambique Tuna bonds, Archegos, and Greensill Capital among others that had already put the bank on the bad side with investors, clients and even the public.
In the memo, the CEO said he was unable to share the transformation plans until October 27.
He wrote,
“I am conscious that there is lots of uncertainty and speculation both outside and within the company.While you will appreciate that I am unable to share details of our transformation plans before October 27, I also want to make sure that you hear from me directly during this challenging period. I will therefore be sending a regular update to you all until then.”
Credit Suisse Collapsing?
There are concerns that the “Too Big To Fail” bank is on the verge of collapse.
This started on Reddit with the discussion on Credit Suisse’s share price being termed as of great concern after falling from $14.90 in February 2021 to $3.90 currently.
Its stock price has been slowly bleeding out since 2009.
There is a significant concern on Credit Default Swaps (CDS) for Credit Suisse that are approaching the highs of the 2008 financial crisis.
Will Credit Suisse be the next Lehman Brothers?
