Credit Suisse’s Fate Was Sealed by Regulators Days Before UBS Deal
- Credit Suisse was unable to rescue itself and had to accept a marriage of convenience with UBS.
- The Swiss National Bank and Finma were instrumental in securing the sale.
- Saudi National Bank's comments caused a dramatic drop in Credit Suisse's stock and bonds.
- Credit Suisse's management team argued that the price tag was derisory for the bank.
- Saudi National Bank later rowed back its comments, saying it merely wanted to stay below a 10% regulatory threshold.
Credit Suisse Turmoil Puts Gulf Investors Among Top Losers
- Middle Eastern shareholders, including Saudi National Bank and the Qatar Investment Authority, have seen the value of their investments in Credit Suisse plummet.
- Gulf Cooperation Council investors have had a checkered record investing in banks overseas.
- The UBS deal has reduced the risk of an additional capital call from Credit Suisse.
- Citigroup analyst Rahul Bajaj suggests that Saudi National Bank should exercise caution when pursuing other transactions.
- Saudi National Bank has stated that changes in the valuation of its investment in Credit Suisse have no impact on its growth plans and 2023 guidance.
UBS to Buy Credit Suisse in $3.3 Billion Deal to End Crisis
- UBS is paying 3 billion francs for Credit Suisse in an all-share deal.
- The Swiss National Bank is offering a 100 billion-franc liquidity assistance to UBS.
- The government is granting a 9 billion-franc guarantee for potential losses from assets UBS is taking over.
- The deal is expected to result in significant job cuts. The Federal Reserve and Treasury Department have welcomed the deal.
Credit Suisse Reels After Top Shareholder Rules Out Raising Stake
- Saudi National Bank, Credit Suisse's largest shareholder, ruled out adding to its stake in the bank, causing its stock to plunge to a record low and leaving leaders struggling to shore up confidence amid market chaos.
- Credit Suisse is in the midst of a complex reshaping that has so far failed to win over investors or halt client outflows, and the effort risks being further complicated by market unease across financials after the collapse of Silicon Valley Bank.
- Concerns about Credit Suisse's future persist despite CEO Ulrich Koerner pointing to the firm's liquidity coverage ratio and inflows on Monday, and the bank's credit default swap level being about 9 times that of Deutsche Bank and 18 times that of UBS Group AG.
India’s Reliance Shifts Traders to Russian Commodities Hub Dubai
- Reliance Industries has moved most of its oil traders from Mumbai to Dubai, as part of a plan announced in 2021.
- Dubai is increasingly becoming a commodities hub, coinciding with Russia's war in Ukraine.
- Most of Reliance's oil procurement and trading activities are now conducted in Dubai.
Egypt Says It Will Support Whatever Is Required to Secure Saudi Funding
- Egypt is willing to do whatever it takes to increase Saudi investments in the country amid its worst foreign-currency crunch in years.
- Saudi Arabia, a major financial backer of President Abdel-Fattah El-Sisi, has delivered only $1.3 billion of the $10 billion pledged to invest in Egypt a year ago. Gulf countries are waiting for more certainty on Egypt's collapsing currency and proof of deep economic reforms before committing big money.
UAE Spy Chief’s Firm Buys Into ByteDance at $220 Billion Value
- Abu Dhabi AI firm G42 has acquired a stake in ByteDance at a valuation of around $220 billion, which is lower than the $300 billion set by TikTok's owner during a share buyback program.
- The stake was acquired through G42's 42XFund, which is controlled by UAE royal Sheikh Tahnoon bin Zayed Al Nahyan, and is worth over $100 million.
- Another fund also bought into ByteDance at a valuation of $225 billion shortly after.
