Credit Suisse to raise 4 Billion Francs capital By Stocksak

© Stocksak. FILEPHOTO: A clock can been seen near the logo and address of Swiss bank Credit Suisse at Paradeplatz in Zurich, Switzerland, October 5, 2022. REUTERS/Arnd Wiegmann/File Photo

By John O’Donnell, Noele Illien, and Michael Shields

ZURICH (Stocksak). Credit Suisse plans 4 billion Swiss Francs ($4Billion) of new capital by selling stock to existing investors.

The bank stated it plans to seperate its investment bank to create CS First Boston. This will be a capital market advisory bank that focuses on capital markets. It hopes to attract third-party capital as well as a partnership with Credit Suisse.

It will also create an unified capital release unit to liquidate non-strategic and higher risk businesses.

Credit Suisse’s overhaul, which aims to put behind it one of the most severe crises in its history, marks the third attempt by successive CEOs in recent years to turn around the bankrupt group. On Thursday, Credit Suisse also reported a third quarter loss of over 4 billion francs.

The bank used to be a symbol of Swiss reliability. But, it has been marred by a series a scandals, including a shocking prosecution at home for laundering money for criminal gangs.

The bank was in a rush to raise money and sell assets to free up capital. It wanted to limit the amount of cash it would need to raise from investors to pay for its overhaul, to handle its legacy litigation costs, and to keep a cushion for turbulent markets ahead.

Credit Suisse must restructure after a series costly and morale-sapping mistakes that led to a wholesale change in management, a halt to dividend payments and an urgent rethinking of its future.

($1 = 0.9858 Swiss francs)

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Stocksak Editorial

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