Credit Suisse shares nosedived to record lows as market jitters swirled around European banks
Geneva (AFP) - Credit Suisse customers in Geneva were not spooked by the bank’s plunge on the stock exchange Wednesday, believing the Swiss government would ride to the rescue before it could ever collapse.
Emerging from the bank’s headquarters in the city, a branch by the Rhone riverside, customers were largely unruffled by the share price tumbling more than 30 percent during the day to a record low.
If the bank went bust, “it will be covered by the government, under 100,000 Swiss francs” per customer, said a 40-year-old personal trainer, who declined to give his name.
“Someone will buy the bank anyway.”
Credit Suisse’s international activities, rather than its Swiss domestic banking, is the greater source of worry, he added.
Share prices nosedived after the bank’s biggest shareholder said they would not up their stake, amid renewed fears of a burgeoning banking crisis.
Another customer stressed that the bank is one of the 30 so-called global systemically important banks deemed too big to fail.
“I’m not worried. These are systemically important banks. They can’t go bankrupt,” said the restaurant manager, who is a professional customer at Credit Suisse and also did not want to be named.
The 33-year-old said the government would have to step in – so the bank could not fold without the state’s finances having collapsed too.
- ‘Snowball effect’ -
Inside the branch’s atrium, there was no air of panic as customers queued at various desks.
A sign ooutside a Credit Suisse bank branch in Geneva
Footage of Swiss tennis legend Roger Federer, a Credit Suisse brand ambassador, cycled on the bank’s electronic screens.
Account holder Renate said there were “a lot more people in the hall, people waiting, and I think they want to be reassured.”
Though she thought Switzerland’s second-biggest bank would be “too big to fail”, a year ago she transferred some of her money to the Geneva cantonal bank.
Gemma Monsini asked: “Are they going to warn us or not? If they don’t, it’s dishonest. We small customers need to know what’s going on.”
Global markets have been rattled by the collapse of US tech sector lenders Silicon Valley Bank and Signature.
“It’s a snowball effect,” said a Geneva-based independent asset manager, who cycled up to the branch and seemed unsurprised that Credit Suisse was in trouble.
“I worked 15 years for them, but nearly 35 years ago,” the mortgage-holder said, declining to be named. “There were more people, more counters, a better dynamic.”
Credit Suisse wanted to get rid of small customers, he said, including his wealth management portfolio which didn’t have enough clients.
“That was fine by us as the service was lamentable,” he said.
- ‘It always worked out’ -
Antolin Coll, 79, who worked for Credit Suisse for 22 years, was confident the bank would survive.
Wall Street stocks were back in selloff mode on Wednesday with US banks following their European counterparts lower as investors fixated on Credit Suisse
“I still have my money there,” the retired former manager said.
“I’m not afraid about that, because there have been previous cases and it always worked out.”
Meanwhile at the branch by the railway station, Daniel Rodrigues, a customer of 15 years, said it was hard to imagine the worst.
“If I see it getting worse, I will have to reconsider… moving my money to another bank,” he said.
And Mary Ponomarova, a Ukrainian refugee, said: “Any money I have is here.
“Because it is not my country, I don’t know what to do.”