Credit Suisse’s largest shareholder sold its entire stake
The financial services company Credit Suisse lost one of its oldest and largest shareholders, the American investment manager Harris Associatesdue to the lack of confidence in its strategy, years of scandals and after several losses and exodus of a large part of the clients.
The Financial Times newspaper assured that Harris Associates sold its entire stake, which was around 10% of Credit Suisse shares.
Harris began reducing his exposure in October following the bank’s fundraising of 4.3 billion Swiss francs ($4.3 billion), when the Saudi National Bank replaced him as lead investor and had now divested entirely, the vice president and director said. of investments, David Herro to the financial environment.
“There is a question about the future of the franchise. There have been big exits from wealth management,” he said, referring to the 111 billion Swiss francs (over $118 billion) withdrawn by Credit Suisse customers in the last three months of 2022, particularly after rumors surfaced on social media about the bank’s financial health.
“We have many other options to invest,” he added. “Rising interest rates mean many European financials are going in the other direction. Why bet on something that is burning capital when the rest of the sector is now generating it?
The Financial Times explained that Harris still owns shares in several European financial institutions, including Lloyds Banking Group, Intesa Sanpaolo, BNP Paribas, Julius Baer and the German insurance company Allianz.
The company said it is not convinced that Credit Suisse’s latest restructuring, which includes spinning off its investment bank and bolstering its wealth management business, could turn the tide at the 167-year-old.
“We believe that the plan to restructure the investment bank, while a noble cause, is cumbersome and much more costly in terms of cash consumption than we expected,” Herro told the outlet. “We were also not satisfied with what we got in terms of proceeds from the sale of securitized products.”
Credit Suisse said it was “ahead of our plan” and insisted it had “clear strategic objectives,” adding, “We are very focused on successfully executing our plan and advancing towards our goals to ensure that the new Credit Suisse delivers sustainable value for all of our stakeholders”.
The Spanish media ABC commented that since 2007, Credit Suisse shares lost more than 95% of their value on the stock market. The bank also reported last month about losses of 7.3 billion Swiss francs (more than 7.8 billion dollars) in 2022its second consecutive annual loss and the largest since the global financial crisis, in addition to advancing that there will also be a “significant loss” in 2023.