Shares of Swiss banking giant Credit Suisse Group AG (CSGN) hit a record low on Wednesday after its biggest investor said they could not provide any further financial assistance to the lender. The downward pressure on Credit Suisse dragged the wider European banking sector lower, as investors shied away from risk after the turmoil of the past week.
Credit Suisse is in the midst of a complex three-year restructuring in a bid to return the bank to profitability and is spinning out its investment banking unit while focusing on its key wealth management business. The bank’s second strategy pivot in as many years has failed to win over investors or halt client outflows, and the effort has been further complicated by market unease across financials after the collapse of Silicon Valley Bank.
Credit Suisse Chairman Axel Lehmann said government assistance “isn’t a topic” for the lender, as the bank seeks to shore up confidence among clients, investors, and regulators after a series of missteps.
The US’s Big Four trillion-dollar banks also suffered in premarket after yesterday's rally, with Wells Fargo sliding 4.8 percent, Citigroup dropping 4.6 percent, Bank of America down 3 percent, and JP Morgan seeing a 2.7 percent dip. The news of Credit Suisse’s troubles followed a separate report showing retail sales fell 0.4 percent last month from a growth of 3.2 percent in January, increasing chances that the Federal Reserve will slow its interest rate hikes at its meeting next week.
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