- ALSO READ
Weak financials, shaky management: What's wrong at Credit Suisse?
Credit Suisse loses Asia deputy wealth management head as departures mount
Credit Suisse reports loss for fifth straight quarter, shares slump 10%
Bank stocks can slide more; stay away for now: Analysts
Investors shed $7 billion off Credit Suisse Saudi backer over stake deal
-
India's banking sector will likely have a softer impact from the troubles at Credit Suisse, given the Swiss lender's relatively small presence in the country, equity analysts at Jefferies said on Thursday.
Credit Suisse has a 1.5% share among foreign banks' assets in India and a 'small' 0.1% share of overall banking assets in the country, Jefferies estimated. It has only 1 branch in India and total assets of over 200 billion rupees ($2.42 billion), it said.
"Given the relevance of Credit Suisse to India's banking sector, we see softer adjustments in assessment of counter-party risks, especially in the derivative market," analysts Prakhar Sharma and Vinayak Agarwal said in a note.
Earlier in the day, Credit Suisse said it would borrow up to $54 billion from the Swiss central bank to shore up liquidity and investor confidence after a slump in its shares intensified fears about a global banking crisis.
Credit Suisse, Switzerland's second-biggest bank, is the first major global bank to be given an emergency lifeline since the 2008 financial crisis and its problems have raised serious doubts over whether central banks will be able to sustain their fight against inflation with aggressive interest rate hikes.
Those fears have roiled financial markets globally as well as in India.
Jefferies said it would watch out for liquidity issues and any rub-off on counter-party risk assessment on Indian banks, especially in derivatives.
The brokerage expects the Reserve Bank of India to keep a close watch on liquidity issues and counter-party exposures, and intervene if necessary.
This may also lead to institutional deposits moving more towards larger or quality banks, Jefferies said. ($1 = 82.6530 Indian rupees)
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
Subscribe to Business Standard Premium
Exclusive Stories, Curated Newsletters, 26 years of Archives, E-paper, and more!
Insightful news, sharp views, newsletters, e-paper, and more! Unlock incisive commentary only on Business Standard.
Download the Business Standard App for latest Business News and Market News .
First Published: Thu, March 16 2023. 14:53 IST
RECOMMENDED FOR YOU