There’s reports this morning that New York based BlackRock, Inc. the world’s largest asset manager is mounting a takeover bid for Credit Suisse.
Yesterday the Financial Times reported that Switzerland’s central bank and Finma, the country’s financial regulator, were said to be orchestrating talks between UBS (Union Bank of Switzerland), Europe’s third largest bank and Credit Suisse regarding a potential takeover of the beleaguered bank.
On Thursday morning Credit Suisse shares opened 40% higher following assurances by the Swiss Central Bank overnight that it would shore up the bank after its share price closed at a historic low of €1.70 following an announcement Wednesday morning by its largest shareholder, Saudi National Bank ruling out further investments in the bank.
It was downhill after that with share price sliding back to €1.86 at the close of business yesterday evening giving the bank a value of €8 billion which is 91% lower than its peak when its shares peaked at €84 in April 2007.
It was reported that four rivals were restricting or more closely scrutinising trades with the Swiss bank on Friday evening, including HSBC, Societe Generale and Deutsche Bank.
The European Central Bank and US President Joe Biden sought to reassure investors and depositors this week that the global banking system is safe.
The European Central Bank raised interest rates by 50 basis points on Thursday despite turmoil in financial markets created by the collapse of SVB last week.
ECB President Christine Lagarde promised to supply funds to the euro zone banks if needed, saying they “stand ready with all the tools …to be switched on” if the need arises.
In today’s Irish Times its managing editor Cliff Taylor speculates that there are echoes now of the run-up to the 2008 crash.
“With politicians assuring us that our banks are safe, international tremors, and property prices starting to slip, there are echoes here of the run-up to the financial crash. And this does pose a threat to international economic growth and may raise questions about confidence and financial stability…. the next few months look like they could be bumpy,” he concludes.