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Bond Market News

Credit Suisse May Cut Dividends by 50%, Says S&P; Convicted With Historic Money Laundering

Credit Suisse may cut its dividends by 50% next year due to its bottom-line struggles, said S&P. S&P analysts noted that Credit Suisse would pay out a CHF 0.05/share, vs. a CHF 0.10/share annual dividend after reporting a 2021 loss. “We predict another cut in 2023 with a significant risk of suspension,” the analysts said. S&P’s forecast follows Credit Suisse’s third consecutive quarterly loss warning earlier in June which has “damaged investor confidence”. However, S&P adds that a solid H2 earnings report may help Credit Suisse avoid a dividend cut.

Separately, on Monday, Credit Suisse was convicted on money laundering charges, in the first ever criminal conviction of a major Swiss lender. Credit Suisse was fined CHF 2mn ($2.1mn) alongside a CHF 19mn ($mn) claim which it allowed to be laundered. The money laundering charges are in relation to alleged crimes that took place between 2004-08 for illicit activities like drug offences. This only adds to the already negative string of scandals faced by the bank. The bank said in a statement it will appeal the decision.

Credit Suisse’s dollar bonds were trading stable with its 9.75% Perp at 103.38, yielding 8.9%.

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