Credit Suisse shares recover after falling as much as 10% earlier

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Last Updated on October 4, 2022 by Bitfinsider

After a big market rally, Credit Suisse shares recovered their losses and ended the Monday trading session down around 1%.

At the start of trading, the shares had dropped as much as 10% after the Financial Times reported that the Swiss bank’s executives are in talks with its major investors to reassure them amid growing concerns about the lender’s financial health.

According to one executive involved in the talks, teams at the bank were actively engaging with its top clients and counterparties over the weekend, and they were receiving “messages of support” from top investors.

The market closed down about 1% on the day.

Spreads on the bank’s credit default swaps, which protect investors against financial risks such as default, increased sharply on Friday. They came after reports that the Swiss lender was looking to raise capital, citing a memo from its CEO, Ulrich Koerner.

Year to date, the stock is down roughly 60%.

According to the Financial Times, the executive denied reports that Credit Suisse had formally approached its investors about possibly raising more capital, insisting that Credit Suisse “was trying to avoid such a move with its share price at record lows and higher borrowing costs due to rating downgrades.”

The bank told Reuters that it is reviewing its strategy, which may include asset sales and divestitures.

According to Reuters, Credit Suisse has been in talks with investors to raise capital with various scenarios in mind, including the possibility of the bank “largely” exiting the US market.

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