Saudi National Bank Hit With Over $1B In Credit Suisse Investment Losses

  • Saudi National Bank has reportedly confirmed significant losses amid Credit Suisse Group Inc CS failure, and UBS AG UBS stepped into buying the Swiss bank for $3.2 billion.
  • Saudi National Bank, Credit Suisse’s largest shareholder with around 10% stake, had been hit with a loss of around 80% on its investment.
  • The Riyadh-based bank holds a 9.9% stake in Credit Suisse, having invested CHF 1.4 billion ($1.5 billion), equivalent to CHF 3.82 per share.
  • Under the terms of the rescue deal, UBS is paying Credit Suisse shareholders CHF 0.76 per share.
  • The significant discount comes as regulators try to shore up the global banking system, writes CNBC, tumultuous for the past few weeks following the collapse of Silicon Valley Bank and First Republic bank and significant stock price downturns across the banking sector internationally.
  • “As of December 2022, Saudi National Bank’s investment in Credit Suisse constituted less than 0.5% of Saudi National Bank’s total Assets, and 1.7% of SNB’s investments portfolio,” CNBC reported citing the Saudi National Bank.
  • It said there was “nil impact on profitability” from a “regulatory capital perspective.”
  • “Changes in the valuation of Saudi National Bank’s investment in Credit Suisse have no impact on Saudi National Bank’s growth plans and forward-looking 2023 guidance,” it added.
  • Last week, Saudi National Bank stated that it would not buy additional shares in Credit Suisse, citing that regulatory guidelines do not allow it to invest over 10% of an entity.
  • Photo via Wikimedia Commons
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