Credit Suisse to Cut Hedge Fund Lending by Third After Archegos
This content was published on April 22, 2021 - 09:08
April 22, 2021 - 09:08
(Bloomberg) Credit Suisse Group AG is planning to slash lending to hedge funds by a third after the Archegos Capital blowup cost the bank $5.5 billion and forced it to tap investors for additional capital.
The Swiss lender on Thursday said it’s conducting a review with a goal of “resizing and derisking prime brokerage and prime financing businesses,” confirming a Bloomberg News report two weeks ago. It plans to focus the business on clients that have relationships with other parts of the firm and will reduce lending to hedge funds by some $35 billion, Chief Financial Officer David Mathers said in an interview.
Credit Suisse Races to Contain Archegos Hit With Capital Raising
Bloomberg 4 hrs ago Patrick Winters and Marion Halftermeyer
(Bloomberg) Credit Suisse Group AG moved to contain the fallout from two of the worst hits in its recent history with a surprise capital increase and a sweeping overhaul of its business with hedge funds.
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Switzerland’s second-largest bank is raising $2 billion from investors to shore up capital depleted by $5.5 billion in losses from the collapse of Archegos Capital Management. Chief Executive Officer Thomas Gottstein, who until recently had brushed off concerns that Credit Suisse was taking excessive risks, struck a humble tone Thursday, vowing to slash lending in the hedge fund unit at the center of the losses by a third.
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