Credit Suisse hit hard in market fallout after Silicon Valley Bank’s failure

Silicon Valley Bank: Saudi National Bank (SNB) (1180.SE), the largest stakeholder in Credit Suisse Group, announced on Wednesday that it would refrain from purchasing additional shares of the Swiss bank due to regulatory considerations. “We are unable to because we would exceed 10%. A regulatory problem, “Ammar Al Khudairy, the chairman of the SNB, said in a Reuters interview. Refinitiv data shows that the Saudi bank owns a 9.88% stake in Credit Suisse.

SNB was pleased with Credit Suisse’s recovery strategy

After being hammered earlier this week in market fallout from Silicon Valley Bank’s failure, trading in the Swiss bank’s shares was suspended late today morning as they dropped by a fifth to new record lows. The second-largest bank in Switzerland is attempting to bounce back from a spate of scandals that have damaged its reputation with customers and investors. Client withdrawals increased to well than 110 billion Swiss francs ($120 billion) in the fourth quarter. Al Khudairy claimed that SNB was pleased with Credit Suisse’s recovery strategy and did not believe it would require additional funding, but he also characterised his bank’s investment as opportunistic and not time-sensitive. He continued by saying that the Saudi bank would leave after the shares had been acquired at fair value.

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Saudi lender increased its holding to roughly 10% last year

“They won’t require further funding, in my opinion; their ratios show that they’re in good shape. Also, they are subject to stringent regulation in Switzerland and other nations.” After its participation in Credit Suisse’s capital raise and commitment to spend up to 1.5 billion Swiss francs ($1.5 billion), the Saudi lender increased its holding to roughly 10% last year. In its annual report for 2022, released on Tuesday, Credit Suisse noted that it had found “significant flaws” in the financial reporting controls and had not yet stopped client exodus.

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