4 December (Reuters) – Investors, including the Crown Prince of Saudi Arabia and a US private equity firm run by a former Barclays CEO, have expressed interest in investing $1 billion or more into the new investment banking Credit Suisse (CSGN.S) unit, Wall Street, The Journal reported on Sunday.
Crown Prince Mohammed bin Salman is considering an investment of around $500 million to support new entity CS First Boston (CSFB) and its CEO-designate Michael Klein, the report said, adding that the bank has yet to make a formal offer received from a Saudi company.
Additional financial support could come from US investors, including former Barclays CEO Bob Diamond’s Atlas Merchant Capital, the report said, citing people familiar with the matter.
Credit Suisse did not immediately respond to a request for comment.
In an effort to revive a flagging business, Credit Suisse announced in October that it would transform its investment bank by revitalizing the First Boston brand. The bank has appointed board member Klein to lead CSFB.
Saudi Arabia’s government-controlled Saudi National Bank (SNB) earlier pledged to invest up to 1.5 billion Swiss francs ($1.60 billion) in Credit Suisse itself for a stake of up to 9.9% to invest and said she can support the standalone CSFB, which will operate as an independent capital markets and advisory bank headquartered in New York.
Credit Suisse’s history with the First Boston brand dates back to 1978 when the two joined forces to operate in the London bond market. They later joined forces to found CS First Boston, but a difficult period followed after famous bankers left and the company ran into regulatory troubles.
Some bankers and investors have expressed skepticism about its ability to regain its former glory in a declining market.
($1 = 0.9373 Swiss Francs)
Reporting by Kanjyik Ghosh and Akriti Sharma in Bengaluru; Editing by Cynthia Osterman
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