Downgrading of the second best bank in Switzerland – Business
ZURICH: On Tuesday, the rating agencies Moody’s and Standard & Poor’s downgraded Credit Suisse, which was affected by the scandal, because Switzerland’s second-largest bank has to restructure in a more difficult environment.
Moody’s downgraded the bank’s senior unsecured debt ratings one notch from Baa1 to Baa2 and from A1 to A2 for its long-term senior unsecured debt, it said in a statement. “The negative outlook on these ratings has been maintained,” it said after the “major financial losses” published by Credit Suisse last week.
The rating agency justified its decision by citing the “more difficult macroeconomic and market environment” the bank is having to deal with to stabilize its investment banking business, which is showing signs of “market share erosion”.
“It will take time for the group to stabilize under the leadership of a new board and leadership team,” the US agency said.
Last week, Credit Suisse said it posted a quarterly net loss of 1.593 billion Swiss francs ($1.65 billion) for the April-June period, up from a loss of 273 million Swiss francs in the previous three months and less than the net profit of 253 million Swiss francs in the second quarter of 2021.
Published in Dawn, August 3, 2022