Near ‘cliff’s edge,’ Credit Suisse not seen as systemic risk

- announced it would not provide more money to the Swiss lender. Hours later, Switzerland’s central bank agreed to lend Credit Suisse up to 50 billion francs to shore up its finances. The stock rebounded.

The Saudi bank’s chairman acknowledged surprise at the fallout from his comments but said he was “optimistic” that Credit Suisse would “go back to being what it is” - a bank with a storied legacy dating back more than a century and a half. Credit Suisse was founded as “Schweizerische Kreditanstalt” in 1856 by industrialist Alfred Escher to finance the development of Switzerland’s complex rail network cutting through the Alps.

The “internationalization” of Credit Suisse - focusing more on the United States and adopting an “Anglo-” culture - led to “identity problems” starting in the 1980s, when it began rising from a midsized European bank into a global player, Tobias Straumann, an economic historian at the University of Zurich, said in the Neue Zuericher Zeitung newspaper Friday.

More recently, the issues at Credit Suisse have been mostly about poor corporate governance, questionable staffing decisions and excessively risky investments. Credit Suisse even found itself in Swiss court, getting fined last June for failing to prevent money laundering by a Bulgarian crime ring 15 years earlier. The case partly involved an unidentified wrestler accused of trafficking tons of cocaine through “mules” from South America to Europe and laundering the profits.

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