Charting How Years of Stumbles Led to the End of Credit Suisse

Published: March 16, 2023, 9:00 AM EDT | Updated: March 20, 2023, 12:00 AM EDT

In a matter of days, Credit Suisse Group AG, one of Switzerland’s biggest banks, went from being one of just 30 global systemically important banks to being hastily sold for a fraction of its former value. On Sunday, UBS Group AG agreed to buy its embattled smaller rival for $3.3 billion in a deal that includes extensive government guarantees and liquidity provisions.

Credit Suisse had been tipped into crisis last week as the global financial sector reeled from the sudden collapse of tech-focused Silicon Valley Bank and other US lenders. The Swiss company’s stock was down 24% at the close of business Wednesday — its biggest one-day selloff ever — before rebounding by as much as 40% the next day after tapping the Swiss National Bank for 50 billion francs in a liquidity backstop to help shore up investor confidence. Except it wasn’t enough, with the central bank and Swiss government ultimately brokering the UBS takeover over the weekend.

The panic first gained steam when the bank’s largest shareholder, Saudi National Bank, said it had no interest in increasing its stake if such a request was made — sparking a global market rout that wiped out more than $60 billion in value for European banks.

The company’s crisis and eventual demise is also the result of years of steady decline. The once-mighty lender went from $1.2 trillion in total assets on the eve of the 2008 financial crash to less than half as much now. While the bank had built up a healthier cash cushion in recent years, topping out at $182 billion in early 2022, it had fallen nearly 60% by December. Even the bank’s capital, built up in the decade after the financial crisis, took a dip amid last year’s heavy loss, before Credit Suisse tapped shareholders again for about $4 billion in fresh funds in the last quarter of the year.

Note: Data as of March 15.

Source: Data compiled by Bloomberg

The last five years, in particular, have been marked by a series of headline-grabbing scandals and management missteps that drove Credit Suisse’s market capitalization from more than $50 billion to around $7 billion at the market close on Wednesday. Even the naming of a new CEO in 2022 and wealthy Middle Eastern investors boosting their stake in the firm failed to turn around the bank’s fortunes.

Note: Data as of March 17 close.

Source: Data compiled by Bloomberg

The story was updated with UBS Group AG agreeing to buy Credit Suisse for $3.3 billion. A previous update corrected a chart to show Tier 1 capital.

By Andre Tartar, Raeedah Wahid, Hayley Warren, Mathieu Benhamou and Noah Buhayar

Edited by Chloe Whiteaker, Alex Tribou, Dale Crofts and Michael Moore

With assistance from Jeremy Diamond, Demetrios Pogkas, Marion Halftermeyer and Steven Arons

Charting How Years of Stumbles Led to the End of Credit Suisse

A Shrinking Bank That Has Investors Concerned

Credit Suisse’s Steady Decline