Credit Suisse announced this Wednesday (23) that it expects to register a loss of 1.5 billion Swiss francs (US$ 1.6 billion) in the fourth quarter of 2022 (4Q22), after customers withdraw funds from the bank, amid to its second strategic review in less than a year, with the aim of streamlining its business model to focus on its wealth management division and the Swiss domestic market.
Around 9:17 am (Brasília time), the shares of the Swiss bank retreated 4.54%, quoted at 3.68 Swiss francs.
Restructuring plans include the sale of part of the bank’s securitized product group to US investment houses PIMCO and Apollo Global Management, as well as a downsizing of its struggling investment bank through a spin off (spin-off) capital markets and advisory unit, which will be renamed CS First Boston.
The move aims to shift billions of dollars in underperforming assets across the investment bank to the wealth management and domestic divisions and reduce the group’s costs by $2.5 billion, or 15%, through 2025.
The Swiss bank also projected a loss of approximately CHF 75 million on the sale of its stake in Allfunds Group, which is listed in Amsterdam.
In addition, Credit Suisse shareholders approved today (23) a CHF 4 billion ($4.2 billion) capital increase to help finance its massive strategic overhaul.
Capital raising plans are divided into two parts. The first, backed by 92% of shareholders, grants shares to new investors, including the Saudi National Bank (SNB), through a private placement. The new share offering will make the SNB hold 9.9% of Credit Suisse, making it the financial institution’s largest shareholder.