If Credit Suisse implodes, it will be far worse than the collapse of the SVB – the European economy will fall off a cliff – zoohousenews.com

(Natural News) According to Bloomberg Markets Live reporter and strategist Ven Ram, it’s looking increasingly likely that Swiss banking giant Credit Suisse will be the next big bank to fall, in which case Europe’s economy will plunge off a cliff.

Europe will be the first to feel what Ram has ominously described as an upheaval in the global financial system, leading to major central banks bringing their tightening policies “to a screaming halt”.

“Unlike Silicon Valley Bank and Signature Bank, the Swiss lender is classified by the US Financial Stability Board as systemically important — that is, it is too big to fail, given that a collapse has the potential to trigger a financial crisis,” Ram explained.

On Wednesday, March 15, European Central Bank officials contacted lenders to ask about their financial exposure to Credit Suisse. The bank reported that its assets under management totaled nearly 1.3 trillion Swiss francs, which is the US equivalent of around $1.4 trillion. This accounts for almost 10 percent of the 14.5 trillion euro economy.

This announcement caused Credit Suisse 1-year Sr CDS, which represent the cost of insuring the bank’s liabilities against default for another year, to rise immediately by a record 2,728 basis points. Conversely, the company’s shares fall to record lows while its bonds plummeted to levels that Ram said are “typically associated with hardship.”

All of this came after statements by the Saudi National Bank, Credit Suisse’s largest shareholder. That bank announced it has no intention of investing any more money in the Swiss lender, which is currently undergoing a complex three-year restructuring aimed at returning Credit Suisse to profitability. (Related: Be sure to check out our previous coverage of the financial “death spiral” unleashed after the SVB collapse.)

Will bank failure contagion spread further?

Back in the United States, the Federal Reserve has been working overtime to quell fears of a US bank collapse following the implosion of the Silicon Valley Bank (SVB) and numerous other mostly “woke” banks that have crashed and burned to the ground in recent days. to disperse.

The Fed has unveiled a brand new term financing program that will allow banks to borrow against bonds that may have fallen in value by as much as 100 cents on the dollar. This “backstop,” as they call it, is likely aimed at other troubled banks like SVB, which fell quickly after the Fed began raising rates.

How all of this will affect the European economy remains to be seen, especially after Ralph Hamers, CEO of UBS Group AG, refused to answer “hypothetical questions” about the Swiss rival. Instead, according to Hamers, UBS is “focused on its own strategy”.

At Credit Suisse, CEO Ulrich Koerner pleads for patience, claiming that the bank’s CET1 capital ratio of 14.1 percent in the fourth quarter and a liquidity coverage ratio of 144 percent, which has since been increased to around 150 percent on average, will be enough to take care of the bank to rescue from sinking sands.

“But at stake for policymakers in Europe and the US is a company that has a far greater knock-on effect in its ability to damage sentiment than Silicon Valley Bank and Signature Bank combined,” Ram said.

In the comments, someone wrote the following analogy to describe how they feel about all this banking disaster:

“You know that weird feeling you get in your stomach when the roller coaster climbs the first hill and starts falling down the other side? I just had that.”

The corrupt globalist banking empire is crumbling at the seams. To stay up to date, visit Collapse.news.

Sources for this article are:

ZeroHedge.com

zoohousenews.com