Momentum Profile picture
Oct 3 11 tweets 3 min read
Is #CreditSuisse going bankrupt?

🧵👇🏼
Credit Suisse’ CDS (Credit Default Swaps) have soared.

„CDS“ are used as insurance against bankruptcy of an entity.

The price of #CS CDS jumped because there is a rumor in the market that #CS may be go belly up.
First of all, it must be stated that $CS is a systematically important bank, which DOESN’Tmean that the Swiss government will bail it out, but more, that the Bank must comply with high and strict liquidity requirements.

sif.admin.ch/sif/en/home/fi…
Credit Suisse's CET1 capital ratio (the main capital buffer for banks) was 13.5% in June. The international regulatory minimum rate is 8%, while the Swiss authorities require a higher figure of around 10%. From this perspective, Credit Suisse is doing well.
However, $CS's investment banking arm has been plagued by several scandals that are threatening earnings. This is significant given that the investment bank accounts for a third of the bank's revenues.
Let‘s compare CS with UBS latest numbers

CS:
760 Billion assets
713 Billion debts
168 Billion cash
Debt to Equity: 3.88
Current ratio: 5.6
CET1: 13.5%

UBS:
1,113 Trillion assets
1,056 Trillion debts
195 Billion cash
Debt to Equity: 3.45
Current ratio: 3.1
CET1: 14.2%
Credit Suisse has recently passed a US Stress Test on Banks. Although the article states that $CS has the lowest CET1 ratio from all tested US Banks. CET1 ratio is the core capital of a Bank and reflects its solidity against risk-weighted assets.

finews.com/news/english-n…
$CS is looking into raising capital to replenish financial buffers (specially CET1 raio) that where weakend by last year‘s losses. reuters.com/business/finan…
Another alternative would be to divest units such as asset management or restructure its investment banking arm.

swissinfo.ch/eng/business/c…
CONCLUSION:
$CS capital situation looks far from a default but the Bank is working on improving its financial situation and reputation.

On 27 October $CS will unveil its strategy in the shareholder meeting. However, market rumours may force $CS to anticipate some of its plans.
BTW: Important to know about COCO Bonds of $CS. The trigger of these bonds is usually 7%. As far as the CET1 ratio (13.5% at the moment) doesn’t fall below the trigger, there shouldn‘t be any problems for these type of bonds, eventhough the bond price can be very volatile.

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More from @Momentopflop

Aug 23
El ratio PER (o P/E) engaña!

Aquí hay 8 razones por las que la métrica PER puede ser INCREÍBLEMENTE engañosa (y qué métricas usar en su lugar):

Por .@BrianFeroldi

👇🏼🧵
¿Qué es el ratio PER?

PER es la relación "precio/beneficio" de una acción

Es una métrica simple para determinar la valoración actual de una empresa.

Divide el precio de la acción por los últimos 12 meses de ganancias por acción.
Hay 3 ratios PER principales.

Todos usan un denominador diferente.

1: Ganancias PER TTM (reales)

2: PER Forward: ganancias NTM (estimaciones)

3: PER Forward 1 año: Ganancias del próximo año fiscal (estimaciones)

El #1 es el más popular y referenciado
Read 27 tweets
Aug 22
Porque Berkshire Hathaway $BRK tuvo una pérdida de $43.8 mil millones en el segundo trimestre y donde se esconde el gran problema?

👇🏼🧵
Primero seamos claros en un punto importante: la pérdida de Berkshire fue solo en el papel.
Las ganancias OPERATIVAS de $BRK totalizaron $9,283 mil millones en el 2ndo trimestre de 2022, un aumento del 38,8% con respecto al mismo trimestre del año anterior.
Read 11 tweets
Aug 17
Varios analistas que sigo prevén que el rally que hemos visto en los mercados desde Junio es posiblemente un “bear trap” y que pronto viene la proxima corrección.

En este hilo voy a analizar los indicadores macro principales de EEUU para verificar si lo que dicen tienen sentido
1️⃣ INFLACIÓN
➡️ está actualmente en 8.52%, por debajo del pico en Junio de 9.06%
➡️ Solo el próximo mes sabremos si Junio fue el pico. Pensábamos que Marzo fue el pico cuando la inflación bajó de 8.54% a 8.26% pero después repuntó de nuevo. Image
➡️ el Consumer Price Index se mantuvo sin cambios el mes de Julio gracias a que el precio de la energía bajó -4.6% (fuel oil fue el que más bajó con -11%), aunque el precio de la comida, los otros commodities y los servicios aumentaron un poco. ImageImage
Read 25 tweets

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