Why Is Credit Suisse Plunging on Wednesday?
The financial sector has been under pressure for the past week or so, fueled by the collapse of SVB Financial's Silicon Valley Bank. And leading the way on Wednesday is Credit Suisse (NYSE: CS), with shares down by 24% as of 9:50 a.m. ET and the stock reaching a fresh 52-week low.
Credit Suisse has been struggling in recent years, and it has a massive strategic restructuring underway. As part of that, the bank raised $4.2 billion in capital in 2022, with the Saudi National Bank acquiring a 9.9% stake, becoming Credit Suisse's largest investor.
On Wednesday, in the midst of tremendous uncertainty and investor anxiety in the banking industry, the Saudi National Bank said that it cannot provide the bank with any further financial assistance. Without getting too technical, it's generally not desirable from a regulatory standpoint for any single investor to own more than 10% of a bank's stock.
Source Fool.com
