Credit Suisse announces 3 billion Swiss francs repurchase plan, restructuring plan or see in 20 days

　　Author: Zhou Erin

　　Credit Suisse, mired in bankruptcy rumors, announced on October 7 that it would buy back some senior debt securities of operating companies (OpCos) for about 3 billion Swiss francs in cash.

　　An industry insider told the First Financial Reporter that Credit Suisse seems to want to manage its liabilities before the reform and reorganization.

According to foreign media reports, Credit Suisse Chief Executive Ulrich Korner previously told employees that the bank is at a critical moment and will disclose the latest information on its strategic reform plan on October 27.

The bank has also moved to reassure investors ahead of its Oct. 27 strategic update and quarterly report.

　　Specifically, Credit Suisse announced on the 7th that it is conducting a cash offer to repurchase 8 senior debt securities denominated in euros or sterling, with a total value of up to 1 billion euros.

At the same time, Credit Suisse also announced a cash repurchase offer involving 12 USD-denominated senior debt securities with a combined value of approximately $200 million.

Both Repurchase Offers are subject to conditions set out in the relevant Repurchase Offer Memorandum.

The two repurchase offers will expire on November 3, 2022 and November 10, 2022, respectively, subject to the terms and conditions set out in the offer documents.

　　"These transactions are consistent with our approach to actively managing our overall liability composition and optimizing interest expenses, while also allowing us to seize favorable market conditions and repurchase debt at attractive prices," Credit Suisse said in an email to Yicai.com. .

　　Since the beginning of this year, Credit Suisse's share price has been "halved", with a cumulative fall of more than 20% in September.

As of September 30, the stock price was reported at around 3.92 Swiss francs per share, hitting a historical low.

At the time, the company's five-year credit default swap spread (CDS) continued to soar.

As of 19:53 on October 7, Beijing time, Credit Suisse's share price was reported at 4.48 Swiss francs per share.

　　On October 1, ABC reporter David Taylor posted on Twitter a tweet about a large investment bank on the verge of bankruptcy, and multiple sources pointed to Credit Suisse, a well-known Swiss investment bank.

However, the reporter deleted the tweet on Monday afternoon, and the ABC said it had reminded the reporter about social media norms.

　　Credit Suisse-related rumors have even been compared by some people to the "Lehman turmoil", but Yicai has previously reported that the volatility of the overall market is still relatively stable.

Investment bankers who worked on Wall Street at the time also told reporters that when Lehman Brothers was on the verge of bankruptcy in September 2008, everyone knew about it, and now Credit Suisse's rumors have not caused the overall market to appear that year. Anxiety, the incident is more fermented on social media such as Twitter.

For example, the Fear Index VIX (a common measure of S&P 500 options volatility) and VSTOXX (Europe's VSTOXX Volatility Index) are both quieter.

For more than a decade, European and American regulators have adopted extremely strict and strong supervision of the financial system, and the annual "stress test" has never been absent, which greatly reduces the possibility of systemic risks.

　　As the second largest bank in Switzerland, Credit Suisse has always competed globally with its advantages in wealth management, investment banking and asset management. Credit Suisse is also about to hold 100% of the securities companies in China.

At present, Credit Suisse is in a predicament, and the future will be known in 20 days.

　　Ulrich Korner had previously tried to reassure employees and investors that the bank's finances remained healthy and planned to announce business overhauls on Oct. 27.

Credit Suisse said it has a capital buffer of nearly $100 billion and still expects its highest-quality equity capital to be between 13% and 14% for the rest of the year.

　　Since the beginning of this year, the senior management of Credit Suisse has changed frequently.

According to foreign media reports on October 4, Luke Chiu, managing director of Credit Suisse and head of the China market, has resigned from the bank.

Credit Suisse director and China team leader Nelson Hui has also resigned, along with two relationship managers.

Credit Suisse Hong Kong team director Steven Lau resigned a few weeks ago to join rival firms.

Last month, two other senior private bankers resigned.

A person from Credit Suisse Private Bank told reporters that the overall private banking business is not optimistic this year.

　　In recent years, Credit Suisse has been plagued by a series of scandals, including the collapse of Archegos, the bankruptcy of Greensill, and leaks.