According to the Financial Times, Harris Associates sold its entire stake in Credit Suisse Group AG, ending ties with the firm after nearly two decades of ownership and putting further pressure on the Swiss bank’s leadership.
“There is a question about the future of the franchise,” the FT quoted David Herro, chief investment officer for international equities at Harris, as saying. money management, ,
Read also: Job cuts, no bonuses: Credit Suisse suffers biggest loss since 2008 financial crisis
Harris was the largest shareholder in Credit Suisse for many years, and plans to reduce his 10% stake to 5% by the end of 2022. The stock hit a record low last week, sliding in the wake of last month’s financial results, which showed a larger-than-expected loss after record outflows.
Shares of Credit Suisse have erased about 95% of their value since the summer of 2007. The bank has missed out on its European counterparts’ rally that began late last year as monetary tightening stifled prospects for boosting profitability.
Herro was quoted as saying, “Rising interest rates mean a lot of European financials are going in the other direction.”
Hero did not immediately respond to an email seeking additional details on the settlement.
Credit Suisse is stepping up efforts to bring back customers and prevent an exodus of senior staff that has dealt a blow to its wealth business, which it sees as key to its revival. Customers withdrew an unprecedented 110.5 billion Swiss francs ($118 billion) in the fourth quarter.
Hero also criticized Credit Suisse’s plan to spin it off Investment The FT reported that the bank, led by Michael Klein, said the proposal was “cumbersome” and would cost through more cash than HERO expected.
Harris has owned Credit Suisse stock since the early years of this century and doubled his bet after the 2008 financial crisis. While Herro defended the bank when its problems began, he became more critical of the board as the lender struggled to fix its investment bank and overcome past losses and scandals.
The Saudi National Bank is now the largest holder in Credit Suisse, according to the Zurich-based lender’s website and data compiled by Bloomberg. The Qatar Investment Authority also increased its stake after Credit Suisse issued new shares as part of a 4 billion Swiss franc capital raise late last year.
The text of this story is published from a wire agency feed without any modification. Only the headline has been changed.
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