Longtime troubles at Credit Suisse came to a head this week with a record stock plunge that spread fears of a banking crisis jumping from the U.S. to Europe.
Wednesday after its biggest shareholder — the Saudi National Bank — announced it would not provide more money to the Swiss lender. Hours later, Switzerland's central bank agreed to lend Credit Suisse up to 50 billion francs to shore up its finances. TheOn Friday, shares dropped 8% to close at 1.86 francs on the Swiss exchange. The stock has seen a long downward slide: It traded at more than 80 francs in 2007.
The Saudi bank's chairman acknowledged surprise at the fallout from his comments but said he was “optimistic” that Credit Suisse would"go back to being what it is" — a bank with a storied legacy dating back more than a century and a half., and they are looking for stories or things that validate concern," Saudi National Bank Chairman Ammar al-Khudairy told CNBC on Thursday.
At the time, it was a high-risk, loss-making industry. Historians say a penchant for risk and innovation permeates through the corporate culture even today. “ simply couldn’t cope with this American investment bank culture, with its focus on risk and high profits,” he said. “The combination of Anglo-Saxon investment banking and Swiss asset management did not work in the long run."
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