Credit Suisse’s former top investor completely quits crisis bank

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“One of Credit Suisse’s longest-serving shareholders sold his entire stake in the scandalous Swiss bank after losing patience with the bank’s strategy in the face of continued losses and loss of customers.” Financial Times » next week.

According to the newspaper’s report, US investment giant Harris Associates has sold all its shares in the Swiss crisis bank. Just last year, Harris Associates owned 10 percent of Credit Suisse (CS). Chicago-based investment firm, which has been one of the most important supporters of the Swiss bank for years, has now completely separated from CS.

Harris Vice President and Chief Investment Officer (CIO) David Herro, 62, told the Financial Times that the bank’s future is “questionable”. “There have been big exits from wealth management,” Herro referred to the CHF 111 billion withdrawn from CS clients in the last three months of last year. This comes after rumors surfaced on social media about the bank’s financial health.

“Loss of time and value for years”

Herro expresses skepticism about CS’ claims that the most recent radical restructuring could change the course of the 167-year-old bank. “We have many other opportunities to invest,” says Herro. “Rising interest rates mean many European financial stocks are going the other way. Why invest in something that burns capital when the rest of the industry is now generating capital?”

CS measurably impaired Harris’ “performance”. You can’t win every time. We talk to every business we own, but they spend a lot more time with their troubled children. Credit Suisse has wasted time and value for years.”

Harris joined CS in 2002 with a share price of 30 francs. After the sale for more than double the price in 2008, Harris bought the shares again from CS in 2009 for 23 francs, which seemed like a bargain buy at the time. After a brief spike in price, CS shares have been in a steady decline ever since. At the close of Friday, the cost of one CS stock is still CHF 2.78.

“Credit Suisse is a takeover candidate”

The two largest shareholders of CS are currently the Saudi National Bank with a 10% stake and the Qatar Investment Authority with a 7% stake. When the Saudis joined in October, Harris had begun to reduce his exposure to CS. Now the Americans have completely left CS.

With its full withdrawal, Harris is likely to spark new takeover rumors about the traditional Swiss bank. In March, Harris-CIO Herro warned that the crisis financial institution was a “takeover candidate”, as reported by “Finanz und Wirtschaft”. The once-largest CS shareholder saw the big bank as a bargain over the current share price: “Credit Suisse is a takeover candidate,” says Herro. (cut)

Source :Blick