“The answer is absolutely not, for many reasons. I’ll cite the simplest reason, which is regulatory and statutory,” Ammar Al Khudairy informed Bloomberg.
“We now own 9.8 per cent of the bank — if we go above 10 per cent all kinds of new rules kick in, whether be it by our regulator or the European regulator or the Swiss regulator.
“We’re not inclined to get into a brand new regulatory regime.”
He made similar comments to Reuters on the sidelines of a conference in Saudi Arabia.
In October, the lender embarked on a “radical” restructuring plan that entails cutting 9000 full-time jobs, spinning off its investment bank and focusing on wealth management.
The Saudi National Bank — which describes itself as the kingdom’s biggest bank — committed $US1.5 billion ($2.25 billion) of the $US4 billion ($6 billion) in new capital Credit Suisse raised to fund its overhaul.
Al Khudairy said that he was pleased with the restructuring, adding that he didn’t think the Swiss lender would need extra money.
“We are proud of the plan, the transformation plan that they’ve put ahead. It is a really robust financial institution,” Al Khudairy said in the interview with Reuters.
“I do not suppose they’ll want extra cash; in the event you have a look at their ratios, they’re tremendous. And they function below a robust regulatory regime in Switzerland and in different international locations,” Al Khudairy said.
Credit Suisse declined to comment.
Markets flash warning signs
The bank’s shares were trading down nearly 22 per cent in Zurich on Wednesday, and the cost of buying insurance against the risk of a Credit Suisse default hit a new record high, according to S&P Global Market Intelligence.
The crash spilled over into other European banking shares, with French and German banks such as BNP Paribas, Societe Generale, Commerzbank and Deutsche Bank falling between 8 per cent and 10 per cent.
Customers withdrew billions from Credit Suisse last year, contributing to the bank’s biggest annual loss since the global financial crisis in 2008. And the blows keep coming for Switzerland’s second biggest bank.
On Tuesday, it acknowledged “materials weak spot” in its financial reporting and scrapped bonuses for top executives.
Credit Suisse said in its annual report that it had found “the group’s inner management over monetary reporting was not efficient” because it failed to adequately identify potential risks to financial statements.
The board concluded that the “materials weak spot might lead to misstatements of account balances or disclosures that might lead to a cloth misstatement to the annual monetary statements of Credit Suisse”, the annual report said. Credit Suisse is urgently developing a “remediation plan” to strengthen controls.
Speaking to Bloomberg TV on Tuesday, Credit Suisse CEO Ulrich Körner said the bank saw “materials good inflows” of money on Monday, even as markets were spooked by the collapse of Silicon Valley Bank and Signature Bank in the United States.
This town was just crowned Aussie town of the year
Outflows from the bank had “considerably moderated” after customers withdrew 111 billion francs ($18.2 billion) in the three months to December, Körner added. In its annual report, the bank said outflows had not yet reversed by the end of last year.
Körner said the collapse of SVB was “considerably of an remoted downside.”
Credit Suisse follows “materially completely different and better requirements relating to capital funding, liquidity and so forth”, he added.
Source: www.9news.com.au
