Cracks Appear in Credit Suisse's 'Rock-Solid' Comeback Plans

After months of reflecting, Credit Suisse's chairman Axel Lehmann revealed an overhaul "to rebuild Credit Suisse as a strong ... bank with a firm foundation, rock-solid like our Swiss mountains." It did not take long for the first cracks to appear.

Photo Insert: Credit Suisse recently outlined plans to raise 4 billion Swiss francs from investors, cut thousands of jobs and shift its focus from investment banking toward its rich clients.

The announcement of the blueprint early on Thursday triggered a sell-off in the bank's stock that lobbed more than 2 billion Swiss francs ($2 billion) off its market worth, almost a fifth of its value, taking its worth to less than 11 billion Swiss francs, Noelle Illien, Jake O’Donnell and Davide Barbuscia reported for Reuters.

"You come away with the feeling that they were rushed ... with a deeply incomplete plan," Goldman Sachs analysts wrote to their clients in a note seen by Reuters, adding that the bank's plan was "short on detail".

Such sentiment was echoed elsewhere. "A lot of detail is lacking still," said Johann Scholtz, an analyst with Morningstar. Unusually, Swiss regulator FINMA too struck a guarded tone, saying it would keep close tabs on the bank as it rolls out its plan.

"It is clear that FINMA will continue to monitor that all the supervisory requirements are met during the implementation phase of the new strategy," it told Reuters.

Credit Suisse recently outlined plans to raise 4 billion Swiss francs from investors, cut thousands of jobs and shift its focus from investment banking toward its rich clients.

The announcement followed a difficult few weeks when the one-time respected Swiss institution had even become a “meme stock” at the center of a social media storm.

Credit Suisse said its clients pulled funds in recent weeks at a pace that led the lender to breach some regulatory requirements for liquidity, underscoring the deep impact of wild market swings and social media speculation about its health.

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