The Troubling State of Credit Suisse: What Investors Need to Know
@Just Do It:
Credit Suisse, with total assets of approximately $1.4 trillion as of the end of 2022, has more than double the assets that Lehman Brothers had when it collapsed in 2008. Despite this, the financial company is teetering on the brink of bankruptcy, and investors need to be aware of the risks. One of the main indicators of the company's troubles is the severe inversion of its credit default swap (CDS) rates. As of Tuesday, the indicative quote for a one-year CDS on Credit Suisse bonds was 835.9 basis points, according to CMAQ. Other sources indicate that this price rose even further on Wednesday, approaching 1,000 basis points. This high CDS price indicates a higher likelihood of default. Credit Suisse's one-year CDS price is currently about 18 times that of its competitor, UBS, and nine tim