Credit Suisse is set to borrow up to CHF50bn ($54bn) from the Swiss National Bank (SNB) to strengthen its liquidity amid growing fear of a global banking crisis.
The company would access the funds from the Swiss central bank, under a covered loan facility and a short-term liquidity facility, which are fully collateralised by high-quality assets.
The additional liquidity would support Credit Suisse’s core businesses and clients.
FINMA and SNB, in a joint statement, assured that Credit Suisse meets the capital and liquidity requirements that are applicable to large-scale banks.
In addition, the collapse of certain banks in the US may not pose a direct risk of contagion for the Swiss financial markets.
Credit Suisse CEO Ulrich Koerner said: “These measures demonstrate decisive action to strengthen Credit Suisse as we continue our strategic transformation to deliver value to our clients and other stakeholders.
“We thank the SNB and FINMA as we execute our strategic transformation. My team and I are resolved to move forward rapidly to deliver a simpler and more focused bank built around client needs.”
The bank also announced that Credit Suisse International will repurchase certain OpCo senior debt securities for cash consideration of up to CHF3bn.
The investment bank would make a cash tender offer for ten US dollar-denominated senior debt securities, for an aggregate consideration of up to $2.5bn.
In addition, the company would make a separate cash tender offer for four Euro-denominated senior debt securities for an aggregate consideration of up to €500m.
The two offers, which are subject to several conditions as per the respective tender offer memoranda, will expire on 22 March 2023.
Credit Suisse is currently undergoing a major restructuring of its organisational structure, reducing costs, cutting jobs and creating a separate business for its investment bank.
Recently, FINMA investigated possible violations of financial market law, with respect to outflows of client funds at Credit Suisse, and has found basis to open proceedings.
