Credit Suisse hits a new low as investors weigh outflow damage

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(Bloomberg) — Credit Suisse Group AG fell to a new all-time low as investors weighed the impact of the bank’s massive outflows reported this week and news that rivals in Asia’s top growth market are profiting from the Swiss company’s troubles.

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Shares of the lender fell as much as 5% in Zurich on Friday after Vontobel lowered its price target and said the company “urgently” needs to halt outflows in its core asset management business. The stock has fallen for nine consecutive days, the longest losing streak since 2014.

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Credit Suisse announced on Wednesday that customers had raised about 84 billion francs ($89 billion) in the first six weeks of the fourth quarter, with no turnaround in sight. The outflow was particularly pronounced in the asset management department, where they amounted to 10% of the assets under management.

Rivals such as UBS Group AG and Morgan Stanley are among the beneficiaries of that client exodus, Bloomberg reported Thursday, with both firms seeing significant new business in Asia, a key growth market for asset management. According to a 2021 Asian Private Banker ranking, UBS runs Asia’s largest private bank by assets, excluding onshore China, while Credit Suisse is the second largest.

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Read more: Credit Suisse customers fly to UBS in Asia as Rich Weigh Options

Andreas Venditti, an analyst at Vontobel, said he was “baffled” by the outflow and predicted that Credit Suisse will post another loss next year amid high borrowing costs. He lowered his share price target from 4 francs to 3.5 francs.

Shares fell 4.5% to 3.39 francs at 3:04 p.m. in Zurich.

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(Updates the movement of the stock everywhere.)

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