Beleaguered Credit Suisse to raise US$2b
Credit Suisse will raise over US$2 billion to strengthen its capital base after flagging a further hit from the collapse of US investment fund Archegos and a shrinking of the prime brokerage unit responsible for the multi-billion dollar debacle.
The demise of Archegos and another major client, British finance firm Greensill, have plunged Credit Suisse into crisis, triggering losses, sackings and bonus cuts at a time when rivals are revelling in bumper profit from trading and dealmaking.
In a further blow for Chief Executive Thomas Gottstein, Switzerland’s financial regulator has opened enforcement proceedings against the bank over how it handled the risks around Archegos and Greensill.
Credit Suisse said it expects a hit of about 600 million Swiss francs (US$655.81 million) for the April-June quarter after exiting most of its Archegos-related positions. A 4.4- billion franc hit in January-March wiped out what would have been a stellar trading period.
Its shares fell 5.7 percent.