Credit Suisse has revealed the extent of the damage caused by March’s banking crisis before its rescue deal by UBS was agreed.
The Swiss banking and wealth management giant haemorrhaged CHF 61.2bn (£55.2bn) in the first three months of 2023, the firm revealed in a Q1 update. The bank said: “These outflows have moderated but have not yet reversed as of April 24, 2023.”
The update follows the $3.2bn rescue deal which saw UBS agree to take over its rival on 19 March.
The firm said it was working with UBS to ensure the merger is completed “in a timely manner”, though some doubts remain over the legality of the deal, while holders of the $17bn (£13.7bn) AT1 convertible bonds that were wiped out as part of the rescue look set to take legal action.
The acquisition had been backed by the Swiss government and Swiss regulators after Credit Suisse’s share price began to plummet in the wake of Silicon Valley Bank’s collapse. The firm’s annual report had revealed “material weaknesses” which unnerved investors.
In terms of divisions, the Swiss banking giant’s flagship wealth management arm saw assets under management plummet by 29% compared to the same period last year, falling to CHF 502.5bn (£454.2bn). At the end of Q1 2022, its AUM stood at CHF 707bn (£638.4bn).
The first quarter update also revealed outflows in Credit Suisse’s asset management sector as investors pulled a net CHF 11.6bn (£10.5bn), driven by outflows from fixed income and index solutions.
See also: UBS takeover of Credit Suisse gets US green-light but legal doubts linger
