Credit Suisse Group AG’s one-year bond default guarantee fee has approached 1,000 basis points (bp = 0.01%). This usually indicates a serious investor concern.
A one-year credit default swap (CDS) backing Credit Suisse bonds was quoted at 835.9 basis points (bp = 0.01%) at the close of trading on Tuesday, according to CMAQ data. Other price sources suggested that the cost of guarantees has risen further on the 15th. The guarantee fee of 1,000 basis points is about 20 times higher than that of peers UBS Group and 10 times higher than Deutsche Bank.
The CDS curve has also reversed, with short-term guarantee costs higher than long-term. The curve had not reversed until the 10th of this month.
Axel Lehmann, chairman of the bank, said on Monday that government aid was “not on the agenda” and said it was inaccurate to compare the bank’s troubles with the failure of Silicon Valley Bank (SVB). Meanwhile, Ammar Hudari, chairman of Saudi National Bank, the largest shareholder of Credit Suisse, ruled out the possibility of providing additional support to the bank on Bloomberg Television.
The bank said on Monday it had found “substantial weaknesses” in its financial reporting and management procedures over the past two years.
Credit Suisse ‘significant weaknesses’ in internal control of financial reporting(2)
Original title:Credit Suisse One-Year Default Swaps Near 1,000 Basis Points、Credit Suisse Chair Says State Assistance ‘Not a Topic’ for Bank、*CREDIT SUISSE TOP SHAREHOLDER RULES OUT MORE ASSISTANCE TO BANK（抜粋）
