Skip to content Skip to Search
Skip navigation

No more investment in Credit Suisse, says Saudi National Bank

Shares in Credit Suisse plunged 30% to a record low on Wednesday Reuters/Arnd Wiegmann
Shares in Credit Suisse plunged 30% to a record low on Wednesday
  • Shares in Swiss Bank continue to decline
  • SNB has 10% stake in Credit Suisse
  • Silicon Valley Bank collapsed earlier this week

Saudi National Bank has ruled out any further investment in Credit Suisse as the troubled Swiss bank shed a quarter of its value on Wednesday.

Saudi National Bank (SNB) chairman Ammar Al Khudairy said during an interview with Bloomberg TV that investing any more would then increase its current 10 percent stake in the the Swiss lender, which would lead to regulatory issues.

“If we go above 10 percent, all new rules kick in, whether it be by our regulator or the Swiss regulator or the European regulator,” he said.

“We’re not inclined to get into a new regulatory regime,” he continued. “I can cite five or six other reasons, but one reason is there is a glass ceiling and we’re not going to entertain going beyond it.”

SNB, which is 37 percent owned by Saudi Arabia’s sovereign wealth fund, became an anchor investor in Credit Suisse’s $4.3 billion capital raise, which began in October to fund the bank’s revamp and restructuring. 

The stake, initially worth 1.4 billion Swiss francs ($1.53 billion), has since lost more than 500 million francs, according to the Bloomberg report.

The second biggest bank in Switzerland is looking to recover from a string of scandals that have undermined the confidence of investors and clients.

Customer outflows in the fourth quarter of last year rose to more than 110 billion Swiss francs.

Earlier this week Credit Suisse published its annual report for 2022 where it revealed “material weaknesses” had been identified in controls over financial reporting and it had not yet stopped customer outflows.

Shares fell below the 2-Swiss franc mark for the first time in Zurich on Wednesday as they headed for a seventh straight daily decline. 

The cost of insuring the company’s bonds against default also increased.

Five-year credit default swaps on Credit Suisse debt widened to 574 basis points from 549 bps at last close, a new record high, according to data from S&P Global Market Intelligence. 

The Qatar Investment Authority (QIA), the Gulf state’s sovereign wealth fund, increased its stake in Credit Suisse to just under 7 percent in January, becoming the Swiss bank’s second largest shareholder behind SNB.

QIA bought 139.03 million shares in the Swiss lender, bringing its ownership to 6.87 percent.

Saudi Arabian conglomerate Olayan Group owns a stake of about 3 percent, Eikon data shows.

Speaking at the Financial Sector Conference in Saudi Arabia on Wedensday, Credit Suisse Group AG’s chairman Axel Lehmann said it would not be accurate to compare its problems with the recent collapse of Silicon Valley Bank (SVB), particularly because the banks are regulated differently.

SVB Financial Group on Friday became the largest bank to fail since the 2008 financial crisis, roiling markets and leaving billions of dollars belonging to companies and individuals stranded.

Latest articles

An artist's impression of part of the Diriyah Square development

Diriyah Square planned for historic Riyadh district

A public space featuring 400 retail outlets and 100 restaurants and cafes is planned for the historic Riyadh district of Diriyah. Diriyah Square will be announced next week at the World Retail Congress in Paris and aims to attract a combination of international retail brands and local artisans.  Diriyah Gate Development Authority group CEO Jerry […]

Nature, Undersea cables account for as much as 90 percent of Europe-Asia telecommunications, Water

Iraq and Kuwait team up for European telecom corridor

Iraq’s Informatics and Telecommunication Public Company, a division of the Ministry of Communications, has signed an agreement with Kuwait’s Zajil Telecom to create a telecommunications corridor from the Gulf region to Europe, transiting through Iraq and Turkey. The new route will pass through Iraqi sea and land ports. Iraq’s minister of communications Hayam Al-Yasiri said […]

Passengers at Beijing Capital International Airport. Air China will fly from the airport to Riyadh three times a week.

Third Chinese airline to launch flights to Saudi Arabia

Air China is set to begin flights to Riyadh in May, becoming the third Chinese airline to establish a route to Saudi Arabia. It joins China Southern and Eastern Airlines in connecting China with the kingdom.  Air China’s Airbus A330-300 will serve the Beijing-Riyadh route three times a week. The expansion in capacity between the […]

Highway traffic in California. Opec said the upcoming 'driving season' in the US will provide the usual additional demand for fuel

Opec stands by predictions for oil demand growth

Opec predicts robust fuel use this summer and has stuck to last month’s forecast of relatively strong growth in oil demand in 2024 and 2025. The oil producers’ organisation predicted in its monthly report that global demand will rise by 2.25 million barrels per day (bpd) in 2024 and by 1.85 million bpd in 2025. […]