Credit Suisse Collapse

Credit Suisse, Switzerland’s second-largest bank founded in 1856, collapsed in March 2023 following a series of scandals, regulatory failures, and massive client withdrawals. The bank had suffered years of losses, regulatory penalties, and reputational damage from involvement with Archegos Capital collapse, Greensill Capital bankruptcy, and various compliance failures. A crisis of confidence accelerated when the bank’s largest shareholder, Saudi National Bank, refused to provide additional capital.

On March 15, 2023, massive deposit outflows began as clients withdrew over $60 billion in a single day, effectively creating a modern bank run. Swiss regulators, fearing systemic financial contagion across European markets, orchestrated an emergency weekend takeover by rival UBS for approximately $3.25 billion. The Swiss National Bank provided over $100 billion in emergency liquidity support to facilitate the merger.

The collapse wiped out Credit Suisse shareholders and eliminated $17 billion in Additional Tier 1 bonds, creating controversy over bondholders taking losses while shareholders received some compensation. The event highlighted vulnerabilities in global banking regulation and raised questions about the effectiveness of post-2008 financial reforms in preventing systemic bank failures.