The Night They Drove Ole’ Credit Suisse Down

First came the bankrun about a month ago triggered by guidance that losses would continue.

A couple weeks later came the next drop after chatter hit the street that regulators were digging into what Axel Lehmann (Board Chair) knew about the run and when he knew it.

So it’s like on schedule that CS stock craters 7% to a record low, following some bad press, courtesy of Reuters and Bloomberg.

For those scoring this game, recall CS has a book per share of ~15.25 and tanking fast.

Lords knows what’s in that pile of toxic waste charmingly labelled “held to maturity.”

So, no surprise, Reuters reports CS is frantically buying deposits at any price – offering 6.5-7% annual rate on new three-month deposits of $5 million+ for one-year deposits. 

That’s a Big Twinkie – 100 to 200 bps above JPM, UBS and Citi.

Hilariously, new deposits cost CS more — per Reuters higher than Credit Suisse’s lending rates in Asia.

Do they plan to make it up in volume? Old joke, just kidding

Per Bloomberg, dozens of CS “scalp hunters” have bailed out since September “and are likely to take at least a quarter of the funds they manage to their new employers, rising to as much as 60% in some cases, according to people familiar with the hires.”

Cue up the night they drove ole’ CS down?

“Not like it used to be” — no kidding.