Credit Suisse’s bonds slid further on Thursday, leaving them firmly in distressed territory even after the beleaguered lender turned to the Swiss central bank for support and said it would buy back SFr3bn ($3.2bn) in debt.
A Credit Suisse dollar bond maturing in 2027 gave up gains from earlier in the session to trade down almost 5 per cent on the day, at 66 cents on the dollar. Another dollar bond maturing in 2028 slid 13 per cent to just below 64 cents. The losses came despite a rebound in the troubled lender’s shares on Thursday.
Prices below 70 cents are generally perceived to be a marker of distress, implying a borrower is less likely to meet its payment obligations to debt holders. The bonds in question had been trading in the 80s and 90s, respectively, as recently as Monday, but have dropped sharply this week after the chair of Saudi National Bank, a major Credit Suisse shareholder, ruled out further investment in the Swiss bank.