After the turmoil of 2020, 2021 was supposed to be a year of super-sized numbers, as banks benefited from a global economic bounce. For most, it was. For Credit Suisse, it was assuredly not.
First came the collapse of Greensill Capital. Credit Suisse ran $10 billion worth of funds that invested in notes issued by the supply-chain finance specialist, which filed for insolvency in March.
Then came the shocking implosion of Archegos Capital Management. The meltdown of a hedge fund that lived and died on its love of heavily leveraged stock bets, cost UBS $861 million, Morgan Stanley $911 million, and Nomura $2.9 billion.
But in absorbing a $5.5 billion hit, Credit Suisse was by far the most exposed: Archegos hit both its brand and balance sheet.
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Instead of posting its best trading quarter for a decade, it recorded a SFr252 million ($269 million) loss in the first three months of the year, against net income of SFr1.31