Customers withdrew nearly $69 billion in the first quarter, Credit Suisse said Monday, highlighting the mounting problems the beleaguered Swiss bank faced that led to a quick sale of arch-rival UBS in March.
In its final financial report as an independent company, Credit Suisse — which lost 1.3 billion Swiss francs, or $1.46 billion, in the first three months of the year — said it had suffered “Large outflows of net assets outEspecially in the second half of March.
It came as investors feared for the health of the 167-year-old distressed lender, sending its shares plummeting and forcing the bank to borrow billions from the Swiss central bank to boost confidence in its finances. Shareholders have been nervous about Credit Suisse for months, worried about its ability to survive amid losses and a series of financial scandals and missteps.
But the Swiss government eventually forced the company to sell itself to UBS for $3.2 billion. The deal — the most high-profile banking deal since the 2008 financial crisis — was one of the most radical efforts to calm markets amid the turmoil caused by the mid-March collapse of the Silicon Valley bank.
While customer withdrawals at Credit Suisse have slowed since then, they have not yet abated, suggesting UBS’s business has ground to a halt as it prepares to absorb its doomed rival. Meanwhile, Credit Suisse still has CHF108 billion in debt from the Swiss National Bank, even though it paid back CHF60 billion during the quarter.
In Monday’s announcement, Credit Suisse also said it had closed a $175 million deal to buy the boutique investment bank of Michael Klein, a longtime dealmaker and former board member. This acquisition was part of a complex financial turnaround plan that included merging the investment bank Credit Suisse with Mr. Klein, which eventually led to the joint management of the business.
