Credit Suisse crisis: Saudi National Bank says Swiss banking major never asked for any assistance after Oct

Saudi National Bank (SNB) on Thursday has clarified that Credit Suisse had never asked for capital infusion or any assistance in the first place. On Wednesday, Credit Suisse stocks lost almost 30 per cent in the market trading after reports emerged that its largest investor, SNB, ruled out providing more financial assistance to the bank. It cited regulatory issues for its decision to step back.  

On Thursday in another interview, Ammar Al Khudairy, Chairman of Saudi National Bank, denied having any discussions with Credit Suisse about assistance. “There has been no discussion with Credit Suisse about providing assistance. I don't know where the word assistance came from. There has been no discussions whatsoever in the past, since October, about Credit Suisse needing more capital, or requiring assistance,” Khudairy told CNBC.

He added, “It was a manifestation of unfortunate reporting or chatter in the system that we had refused assistance, but we were never asked and, and, to my knowledge, there has not been any assistance sought.”

On the panic that has panned out from the recent developments around Silicon Valley Bank and Credit Suisse, SNB Chairman said, “If you look at how the entire banking sector has dropped, unfortunately, a lot of people were just looking for excuses. It’s panic, a little bit of panic. I believe completely unwarranted, whether it be for Credit Suisse or for the entire market."

Khudairy said the recent fallout of the collapse of Silicon Valley Bank was different from the 2008 financial crisis, saying that steps taken by US. regulators to protect depositors have contained further fears of contagion.

“We did have a failure last week, but that’s nowhere near, nothing to do with what we saw in 2008. This is just one isolated incident, the regulators have cut off any possibilities of a spillover,” he said.

On Thursday, Credit Suisse shares soared over 40 per cent at Thursday’s market after Switzerland’s central bank stepped in. This triggered a rally in banking stocks across Europe

The Euro Stoxx Banks Index climbed 3.5 per cent at 9:09 a.m. in Paris after tumbling 8.4 per cent on Wednesday, the most since March 2020, on mounting concerns over the health of Credit Suisse. The broader Stoxx 600 Banks Index rallied 3.1 per cent. Credit-default swaps showed easing tension in debt markets.