Credit Suisse, which is in trouble, said on Friday that it has made an offer to buy back up to 3 billion Swiss francs ($3 billion) of senior debt securities. The company is trying to calm investors’ worries before its strategic review at the end of the month.
This week, the lender’s shares and bonds fell because investors were worried about its ability to restructure the business without asking for more money.
The bank said in a statement, “The transactions are in line with our proactive approach to managing our overall liability composition and getting the most out of our interest costs. They also allow us to take advantage of market conditions to buy back debt at attractive prices.
Related: A planned capital increase for a Credit Suisse Property Fund has been put off.
Switzerland’s second-largest bank said it was making a cash tender offer of 1 billion euros for eight senior debt securities denominated in euros or pounds sterling. It also made an offer to buy back 12 senior debt securities denominated in U.S. dollars for up to $2 billion.
Executives at a bank spent the weekend reassuring big clients, other banks, and investors about the bank’s liquidity and capital. In a memo to staff, CEO Ulrich Koerner also said that the company has good capital and cash flow.
Credit Suisse is a global systemically important bank and one of the largest banks in Europe. After losing more than $5 billion from the collapse of investment firm Archegos in March 2021, when it also had to stop client funds linked to failed financier Greensill, it had to raise capital, stop buying back its own shares, cut its dividend, and change its management.
When it reports its third-quarter results on October 27, the bank plans to talk about its new business plan.
Moody’s (NYSE:MCO) Investors Service expects Credit Suisse to lose $3 billion by the end of the year. This could put the bank’s core capital below the important 13% level, said Moody’s lead analyst on the bank, who spoke to Reuters.
In order to make money again, the bank has been looking into selling assets and businesses.
Related: The energy crisis, UK tax plans, and Credit Suisse are in the spotlight.
It said on Thursday that it wants to sell the famous Savoy Hotel in Switzerland’s financial district. Local media said that the sale could bring in about 400 million francs.
$1 is worth 0.9897 Swiss francs.
