Wednesday, August 4, 2021

Qatar Investment Authority raises stake in Credit Suisse to 6 pc

DUBAI/LONDON: Qatar Investment Authority (QIA) has raised its stake in Credit Suisse to 6 per cent, in a move seen as underlining its long-term commitment to the troubled lender, Reuters has reported.

The stake, higher than earlier estimated, follows QIA subscribing to two convertible notes, which will be converted into shares later this year, according to a regulatory filing.

Qatar’s $300 billion sovereign wealth fund is the biggest shareholder of Credit Suisse, but a filing in late June showed its stake had slipped below 5 per cent, raising questions about its commitment to the investment.

Management under pressure

Credit Suisse’s top management is under pressure to come up with an overhaul plan after losing more than $5 billion in the rush to unwind trades by family office Archegos and suspending funds linked to Greensill.

However a new filing with the US Securities and Exchange Commission showed that the Qatari fund was among the investors who subscribed to Credit Suisse’s capital raising in April when the Swiss lender issued mandatory convertible notes.

Stock exchange data still shows QIA’s stake of 4.84 per cent, however the stake rises to 6.01 per cent if the convertibles are taken into account, the new filing shows.

Credit Suisse in April said the mandatory convertible notes will be converted upon six month maturity, but they could be subject to early conversion upon the occurrence of certain events.

QIA first invested in Credit Suisse in 2008, at the height of the financial crisis,and later increased its stake to above 5 per cent.

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