Credit Suisse Group AG (CS) stock is facing negativity on Thursday, April 22, 2021. As of this writing, it has lost 7.03%. CS’s stock gained 0.87% to close Wednesday’s session at $10.38. CS shares have risen by 35.74% over the last 12 months, and they have moved down by -2.44% in the past week. Over the past three months, the stock has lost -24.62%.
Let’s checkout CS recent developments.
$2 billion raised by CS after Archegos loss
CS is asking investors for more investment to bolster its balance sheet as the aftershocks from the Archegos Capital blowup continues.
Credit Suisse has issued notes and sold mandatory convertible notes to a selected group of core shareholders, institutional investors, and ultra-high-net-worth individuals in efforts to raise more money to strengthen its capital position.
The issued convert into 203 million shares in Credit Suisse. Half will convert in six months at a 5% discount to the market rate.
CS has to face legal battles
After the two financial blowouts, CS has to face multiple lawsuits from several legal firms on behalf of investors who lost their investment and the Swiss Financial Market Supervisory Authority (FINMA) also commenced enforcement proceedings against Credit Suisse to investigate significant losses linked to U.S. hedge fund Archegos Capital Management.
FINMA also opened proceedings against the bank over losses linked to collapsed supply-chain finance firm Greensill Capital.
A pension fund also filed a lawsuit against Credit Suisse Group AG in a U.S. court, accusing the Swiss bank of misleading investors and mismanaging risk exposure.
CS selling big blocks of shares
On April 14, 2021, Credit Suisse Group AG sold $2 billion of stocks related to the Archegos Capital Management blowup.CS offered stocks include Discovery Inc. and Iqiyi Inc.
The bank offered19 million class A shares and 22 million class C shares of Discovery on the market as well as 35 million U.S.-listed shares of iQIYI.
CS facing $4.7 Billion Loss after Archegos scandal
On April 6, 2021, Tuesday credit Sussie said that it is expecting a loss of 4.7 billion in the first quarter of 2021 after the meltdown of Archegos Capital Management. Switzerland’s second-largest lender has offloaded over $2 billion worth of stock to end exposure to the troubled investor.
The Archegos fallout is the second major scandal for Credit Suisse in just over a month after the collapse of Greensill Capital, making it the worst-performing major bank stock in the world this year.
CS still getting the aftershocks from Greensill Capital and Archegos fallout and the present time is very tough for CS stock. CS may not lose the significant value of its stock because it’s one of the major banks and has a strong financial background but it is defiantly feeling the pressure.
Credit Suisse Group AG is a global wealth manager, investment bank and financial services firm founded in 1856 and based in Switzerland.