Credit Suisse agreement, global stock market news
It’s hard to overstate how big a deal it would be for Credit Suisse – with its $500 billion in assets and more than 50,000 employees worldwide – to collapse.
The bankruptcy last week of Silicon Valley Bank and Signature, two much smaller regional lenders, has shaken the confidence of investors around the world.
Credit Suisse, one of Europe’s largest lenders, is “much more globally interconnected, with multiple subsidiaries outside of Switzerland, including in the United States,” wrote Chief Economist Andrew Kenningham. for Europe at Capital Economics.
Credit Suisse is not just a Swiss problem, but a global problem.”
Credit Suisse is known as a “Global Systemically Important Bank” (or “G-SIB,” as the cool kids call it).
Once one of these mega-banks gets into trouble, people start wondering what’s going on with the system and speculating who might be next to fall.
Even with a financial lifeline from the Swiss authorities, many risks and unknowns emanate from Credit Suisse, which keeps investors on edge.
Credit Suisse’s turmoil indicates the crisis has not been contained, according to Arthur Wilmarth, a professor at the George Washington School of Law.
“I think it was naive for most people to think it could be contained with just a few regional banks, because clearly there are still shocks rippling through within our own banking system.” , Wilmarth said. “And that would indicate that it could potentially expand to very large banks.”
Learn more here.
cnn
