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Credit Suisse bonds plunged Friday in a new signal that the financial markets are questioning whether the beleaguered Swiss bank will survive – despite the rescue package announced by the Swiss central bank earlier this week.
Credit Suisse one-year bonds were yielding 18% by the close Friday, meaning lenders were demanding at least that rate of interest to provide money to the institution for a single year. That yield was a sharp rise from Thursday, when news of central bank support had initially calmed the markets, and compares with an official Swiss interest rate of just 1%.
Meanwhile stock in Switzerland’s central bank, which is publicly traded, also closed down 1.5%, in a move which may suggest investor disaffection with the situation.
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