Credit Suisse shares fell 5 percent to an all-time low in early trading on Tuesday after the bank confirmed material weaknesses and an $8 billion loss in 2022, just hours after a financial expert warned it would be the next financial institution to fall following SVB.
Last night, Robert Kiyosaki, an investor and author of Rich Dad, Poor Dad, who accurately predicted the 2008 fall of Lehman Brothers, warned during an appearance on Fox Business that ‘the problem’ is the bond market, and that Credit Suisse, the eighth largest investment bank in the world, was most vulnerable.
On Tuesday morning, Credit Suisse published its annual report, which revealed an $8 billion loss for 2022.
The bank had been due to publish the report last Thursday, but was sent back to review its books by the SEC.
Today, Credit Suisse said the ‘weaknesses’ were down to a ‘failure to design and maintain an effective risk assessment process to identify and analyze the risk of material misstatements’.
Credit Suisse CEO Ulrich Koerner has, however, insisted that the ‘SVP credit exposure is not material’.
Kiyosaki said the current situation is the ‘perfect storm’ and fears that Biden’s plan to ‘print more fake money’ would exacerbate the problem.
He maintains that gold and specifically silver are the safest investments now.
The five-year credit default swaps for Credit Suisse have since soared 446 basis points since the SVB crash, according to finance analyst Holger Zschäpitz.
Swiss financial regulator FINMA on Monday said it was seeking to identify any potential contagion risks for the country’s banks and insurers following the collapses of Silicon Valley Bank and Signature Bank.
President Joe Biden pledged on Monday to do whatever was needed to address the banking crisis precipitated by the collapse of the two lenders, which forced regulators to step in with emergency measures to stem contagion.
Kiyosaki is skeptical about Biden’s claim that the bailout of SVP will not cost the taxpayer.
FINMA said it was also monitoring for any spill-over effects from the failure of another tech-focused U.S. bank, Silvergate Capital Corp, which said on Wednesday it was planning to wind down its operations and liquidated voluntarily.
In a further reflection of investor concern about Credit Suisse’s outlook, the price of some of its bonds fell sharply, with some at record lows.
Struggling to recover from a string of scandals, Switzerland’s second-biggest bank has begun a major overhaul of its business, cutting costs and jobs and creating a separate business for its investment bank under the CS First Boston brand.
Last week it announced it was delaying the publication of its annual report following a call from the U.S. Securities and Exchange Commission.
»Credit Suisse CEO Ulrich Koerner insists ‘SVP credit exposure is not material’«
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