Shortly after UBS announced its emergency rescue, investors continued to withdraw billions from Credit Suisse funds, a situation that has since stabilized.
Outflows from Credit Suisse investment funds accelerated in the weeks following its historic merger with Swiss rival UBS, as reported by London's «Financial News» on Monday citing data from Morningstar.
Outflows from about 300 Credit Suisse funds domiciled in the EU and US reached $5.6 billion in the three weeks since the merger. Credit Suisse declined to comment.
Massive Outflows After Bailout
In the week leading up to the merger of the two banks, investors withdrew about three billion dollars from Credit Suisse funds. The massive outflows from the funds began on March 14, when the bank said it had discovered material weaknesses in its annual report. The bank came under pressure from the SEC regarding reporting deficiencies in prior annual reports
The largest daily outflows were recorded two days after the announcement of the landmark deal, on March 21, when $776 million was withdrawn from Credit Suisse's European funds.
Reversal in April
Despite steady outflows in recent weeks, Morningstar figures show Credit Suisse's European funds saw net inflows of more than $240 million on April 5 and 6, suggesting initial signs that investor nervousness is subsiding.
Much of the fund outflows in the days following the merger with UBS were likely by investors worried about the stability of the big bank and unsettled by the turmoil in the banking sector, according to Financial News.
Some outflows in recent weeks were due to Credit Suisse wealth management and asset management clients moving to other firms, according to observers.
Because Credit Suisse and UBS offer broadly similar products in many cases, moving funds into products from other banks allows investors to diversify their portfolios if they already use similar products and services from UBS.
