The weekend, with stock markets closed, gives regulators in Switzerland some breathing room to figure out a for troubled bank Credit Suisse. Investors, meanwhile, are counting their weekly losses.
The problem banks
- Credit Suisse: -25.5 percent in the past week
- First Republic: -71.8 percent
Of the two banks in the spotlight this week - Credit Suisse and First Republic Bank - it is clear that the California bank took the heaviest stock market hit this week, with a price loss of nearly 72 percent over the past week. Credit Suisse lost about a quarter of its stock market value over the same period.
The rescue plans for both banks announced this week already had in common that the banks received hefty liquidity guarantees. Credit Suisse is using the Swiss National Bank's 50 billion Swiss franc infusion, at First Republic, came up with $30 billion in deposits, albeit only for 120 days.
So why the lingering nervousness? "Liquidity alone does not restore solvency," analysts answer. As long as there are doubts about a bank's capital position - say, its financial fundamentals - it will remain under pressure. That explains why compatriot UBS is being looked at to acquire Credit Suisse.
- ING: -14.8 percent
- : -14.2 percent
- Santander: -13.1 percent
- Barclays: -11.3 percent
- : -11 percent
- UBS: -10.8 percent
Share prices of European banks have been greatly affected by the banking crisis in the U.S. and Switzerland, although no direct correlations are known. KBC lost 11 percent in one week and ING even nearly 15 percent. The very similar weekly losses suggest that investors - or their computers - made little distinction between the banks and found the entire European banking sector less attractive.
U.S. major banks
- JP Morgan Chase: -5.9 percent
- Citi: -8.5 percent
- Bank of America: -8.9 percent
- Goldman Sachs: -7.4 percent
The big U.S. banking giants on Wall Street did not remain immune to the turbulence surrounding regional banks like Silicon Valley Bank and First Republic. But remarkably, they were able to limit the weekly damage to significantly less than 10 percent. Thus, they outperformed their European counterparts.
General stock market indices
- S&P500: +1.4 percent
- Bel20: -3.8 percent
- AEX: -2.8 percent
The Bel20 index was able to limit its weekly loss to 3.8 percent. The damage was also limited elsewhere in Europe, and in the U.S. the S&P500 even advanced on a weekly basis. Conclusion: banks may already be in difficult waters, but there is no sign of a broad stock market crisis for the time being.
Crypto: substantial gains
The stock markets may already be closed, but crypto trading continues day and night. Crypto seems to be from the crisis in the traditional financial sector. Bitcoin went from $21,900 this week on Monday to $27,300 this morning. Ethereum is going slightly lower, but is also up sharply in the lieft.
- Bitcoin: +24.6 percent
- Ethereum: +15 percent
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