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Moody's, S&P downgrade Credit Suisse, sinking shares

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Agence France-Presse

<div class="embed-wrap"><figure data-feedback="fb:likes,fb:comments"><img alt="A view of the logo of Swiss bank Credit Suisse in Zurich, Switzerland, 21 February 2022. A major data leak linked to thousands of accounts from one of the world" s="" biggest="" private="" Credit="" allegedly="" exposed="" the="" hidden="" wealth="" of="" clients="" involved="" in="" drug="" money="" corruption="" and="" other="" serious="" crimes.="" Suisse="" released="" a="" statement="" on="" where="" it="" rejects="" allegations="" insinuations="" about="" purported="" business="" EPA-EFE="" ENNIO="" src="https://sa.kapamilya.com/absnews/abscbnnews/media/2022/business/08/03/20220803-swiss-bank-credit-suisse-epa.jpg"/><figcaption>A view of the logo of Swiss bank Credit Suisse in Zurich, Switzerland, 21 February 2022. A major data leak linked to thousands of accounts from one of the world&#x27;s biggest private banks, Credit Suisse, allegedly exposed the hidden wealth of clients involved in drug trafficking, money laundering, corruption and other serious crimes. Credit Suisse released a statement on 20 February, where it &#x27;strongly rejects the allegations and insinuations about the bank&#x27;s purported business practices.&#x27; <em>EPA-EFE/ENNIO LEANZA</em></figcaption></figure></div><p>ZURICH, Switzerland - Ratings agencies Moody&#x27;s and Standard &amp; Poor&#x27;s downgraded scandal-hit Credit Suisse, given the restructuring Switzerland&#x27;s second-biggest bank will have to undertake in a more challenging environment.</p><p>Moody&#x27;s downgraded the bank&#x27;s senior unsecured debt ratings by one notch from Baa1 to Baa2, and from A1 to A2 for its long-term senior unsecured debt, it said in a statement.</p><p>&quot;The negative outlook on these ratings has been maintained,&quot; it said, following the &quot;large financial losses&quot; published by Credit Suisse last week.</p><ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/business/05/12/20/moodys-keeps-philippines-credit-rating-outlook-as-it-flags-virus-risk">Moody&#x27;s keeps Philippines&#x27; 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to stability </strong></div><p>Despite &quot;solid -- although decreasing&quot; capitalization ratios, Moody&#x27;s analysts noted the risk that &quot;further large litigation charges may materialise in the medium term, further delaying a return to profitability&quot;.</p><p>Ulrich Koerner, considered a restructuring specialist, took over as Credit Suisse&#x27;s chief executive on Monday with the mammoth task of revitalising the bank.</p><p>Standard &amp; Poor&#x27;s noted that wealth management at the bank had shown signs of weakness.</p><p>It left its credit rating unchanged, at BBB for the group and A/A-1 for its Swiss subsidiary, but lowered the outlook from stable to negative.</p><p>&quot;We see increasing risks to the stability of the bank&#x27;s franchise, uncertainty around the reshuffling of top executives, and a lack of a clear strategy, and we think the group&#x27;s risk-adjusted and absolute profitability is likely to remain weak over the medium term,&quot; S&amp;P said.</p><p>&quot;The negative outlook reflects the uncertainty regarding Credit Suisse&#x27;s strategy and the significant challenges for the new management to transform the bank against strong operating headwinds.&quot;</p><p>At just after 1500 GMT, Credit Suisse shares were down 5.92 percent percent at 5.21 Swiss francs, while the Swiss stock exchange&#x27;s main SMI index was down 0.25 percent.</p><ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/business/04/19/22/steady-ph-credit-rating-affirms-recovery-strategy-bsp">BSP says affirmed PH credit rating a testament to &#x27;holistic&#x27; 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Ratings agencies Moody's and Standard & Poor's downgraded scandal-hit Credit Suisse, given the restructuring Switzerland's second-biggest bank will have to undertake in a more challenging environment.