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Hurt by Losses, Credit Suisse Faces Reckoning Under New Chairman
The nearly $5 billion loss from the collapse of Archegos Capital Management was just the latest problem for Credit Suisse’s beleaguered investment bank.
António Horta-Osório, who started his job as chairman of Credit Suisse on Friday, is a former chief of the Lloyds Banking Group.Credit.Simon Dawson/Reuters
April 30, 2021
After Credit Suisse said it had lost nearly $5 billion over soured trades that a small unit of its investment bank made with Archegos Capital Management, worried employees peppered Thomas Gottstein, the chief executive, with questions.
One wanted to know if bankers who weren’t involved would have to sacrifice pay over the losses. Another asked why the entire investment bank was tarnished by the actions of one errant unit.
Credit Suisse Raises $2 Billion; Warns on More Archegos Pain
This content was published on April 22, 2021 - 07:09
April 22, 2021 - 07:09
(Bloomberg) Credit Suisse Group AG is raising about $2 billion to shore up capital after warning of another financial hit from the Archegos Capital Management collapse, adding to the Swiss bank’s woes after two blowups within a month left investors nursing losses and questioning its leadership.
The bank, which exited about 97% of its exposure to Archegos, expects a related 600 million-franc ($654 million) hit in the second quarter and is tapping investors for about 1.8 billion francs of funding with two notes convertible into 203 million shares. Swiss regulator Finma has now started enforcement proceedings against Credit Suisse and the bank said it plans to cut back the prime brokerage business at the center of the losses.
Credit Suisse Raises $2 Billion as CEO Cuts Hedge Fund Unit
This content was published on April 22, 2021 - 11:14
April 22, 2021 - 11:14
(Bloomberg) Credit Suisse Group AG is raising $2 billion from investors and cutting the hedge fund unit at the center of the Archegos Capital Management losses as Chief Executive Officer Thomas Gottstein seeks to recover from one of the most turbulent periods in the bank’s recent history.
Credit Suisse, which has exited about 97% of its exposure to Archegos, expects a related 600 million-franc ($654 million) loss in the second quarter, taking the total hit from the collapse to about $5.5 billion. In response, it’s cutting about a third of its exposure in the prime business catering to hedge fund clients, while strengthening capital with the sale of notes converting into shares.
(Bloomberg) Credit Suisse Group AG is raising $2 billion from investors and cutting the hedge fund unit at the center of the Archegos Capital Management losses as Chief Executive Officer Thomas Gottstein seeks to recover from one of the most turbulent periods in the bank’s recent history. Credit Suisse, which has exited about 97% of its exposure to Archegos, expects a related 600 million-franc ($654 million) loss in the second quarter, taking the total hit from the collapse to about $5.5 billion. In response, it’s cutting about a third of its exposure in the prime business catering to hedge fund clients, while strengthening capital with the sale of notes converting into shares. Gottstein is battling to rescue his short tenure as chief executive officer after Credit Suisse was hit harder than any other competitor by the collapse of Archegos, the family office of U.S. investor Bill Hwang. The timing of the blowup could hardly have been worse, coming just weeks after Credit Suisse f