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❓ Has Credit Suisse gone bankrupt yet?

Updated: Dec 7, 2022


🏦 Not long ago we wrote about the best and worst European banks and what to expect from them. Today we will focus on the most notorious of them - Credit Suisse.


👉 It was previously reported that the company wants to spin off its two divisions (investment and consulting) into separate companies.


💰 Also Credit Suisse plans to revive First Boston, an investment bank, which was bought out in 1990. To do so, it is expected to raise about $1 billion. The Crown Prince of Saudi Arabia is reportedly already willing to invest half of that amount.


🧐 Now for the financials: let's highlight the pros and cons of Credit Suisse


🟢 Pros:


📌 Value, Rank: 88% out of 100%.


🔹 The bank is cheaply valued by major ratios (P/S is 1.1). However, this is directly related to low investor expectations. Credit Suisse has become unprofitable, so the stock price has fallen a lot this year.


🔴 Cons:


📌 Financial position, Rank: 24%.


🔸 The liability/asset ratio is 94%, the bank is unprofitable, and asset turnover is only 2%, indicating serious problems. Raising additional funds would help to improve it.


📌 Growth, Rank: 2%


🔸 The Ranks system gives a very low rating due to a significant deterioration in the dynamics of key financial indicators. Assets fell by 18% and capital expenditures, on the contrary, rose by 12%.


📌 Forecasts, Rank: 24%.


🔸 Analysts have a mostly negative view of the stock. Not a single recommendation to buy, most of them with a "Hold" rating. No wonder, as the current state of the bank is more than tough.


💬 To summarize:

▪️ Credit Suisse is trying to save the situation, a number of important and strategic decisions have been made in recent months. The bank is in active search for investors, significant steps have been made in this direction.

▪️ At the moment the financial aspect of Credit Suisse looks very weak, the final Rank 22%


❓In 2008, Credit Suisse stock was worth $70, and now it's worth about $3. Which bank do you think could repeat this fate?

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