Credit Suisse Races to Contain Archegos Hit With $2B Capital Raise

Credit Suisse Group AG moved to contain the fallout from two of the worst hits in its recent history with a surprise capital increase and a sweeping overhaul of its business with hedge funds.

Switzerland’s second-largest bank is raising $2 billion from investors to shore up capital depleted by $5.5 billion in losses from the collapse of Archegos Capital Management. Chief Executive Officer Thomas Gottstein, who until recently had brushed off concerns that Credit Suisse was taking excessive risks, struck a humble tone Thursday, vowing to slash lending in the hedge fund unit at the center of the losses by a third.

Gottstein, in the role for little more than a year, is trying to persuade incoming Chairman Antonio Horta-Osorio that he’s the right person to lead Credit Suisse, after the bank was hit harder than any competitor by the collapse of Archegos, the family office of U.S. investor Bill Hwang. The timing could hardly have been worse, coming just weeks after the lender found itself at the center of the Greensill Capital scandal, when it was forced to freeze a $10 billion group of investment funds. “Clearly this loss came as a big surprise,” Gottstein said about Archegos. “Is it an isolated case? I definitely hope it is and I think it is, but we are obviously reviewing the entire bank now just to make sure that our risk processes and systems are where they should be.” Credit Suisse fell as much as 6.9% in Zurich trading and was 5.3% lower as of 1:54 p.m. local time, taking this year’s losses to about 22%. It’s the worst-performing major bank stock this year and has also suspended a share buyback and cut the dividend.

Having taken on the position more than a year ago, the CEO had stumbled over other hits before Greensill shattered what was supposed to be a new era of calm. While seeking to placate investors hurt by the losses, he also now faces the fresh challenge of navigating enforcement proceedings announced by Swiss regulator Finma on Thursday. The scandals have left the CEO standing while many once powerful members of his management board had to leave. Gone are investment banking head Brian Chin and Chief Risk Officer Lara Warner, along with a raft of other senior executives including equities head Paul Galietto and the co-heads of the prime brokerage business. Asset management head Eric Varvel is also being replaced in that role by ex-UBS Group AG veteran Ulrich Koerner.

The bank now plans to reduce risk at the investment bank, including cutting about $35 billion of leverage exposure at the prime brokerage unit that services hedge funds, Gottstein said in an interview with Bloomberg Television. That’s about a third of the leverage its extends in that business. Going forward, the bank plans to only service clients in that unit if they do business with other parts of Credit Suisse as well, such as the wealth management unit.

https://www.bnnbloomberg.ca/credit-suisse-races-to-contain-archegos-hit-with-capital-raising-1.1593806

this gets better and better each day...

morning

>>47362

good

returning to "normal" here

whatever dat is

Saudi Aramco to refinance $10 billion revolving loans

Saudi Aramco is expected to refinance a $10 billion debt facility raised in 2015, two sources said, in what would be the oil giant’s third major foray into the loan market this year. Aramco, the world’s largest oil company, raised the revolving credit facility in 2015 with a wide group of international and local banks.

That financing included two five-year loans, one in U.S. dollars and one in riyal, and two annually renewable one-year loans, also split between the two currencies. Aramco, which declined to comment, last year extended the two five-year facilities by two years, pushing their maturities to March next year, according to a bond prospectus. It is now planning to refinance the $10 billion revolving loans, two banking sources said, confirming a report by LPC, a fixed income news service that is part of Refinitiv. “Rather than keep rolling it on a year basis, which is where it is right now, they’ll come and do a refinancing,” said one of the sources.

Aramco has recently agreed with banks to extend by a year a separate one-year $10 billion loan it raised in May last year, said one of the two banking sources. It is also arranging a $10.5 billion loan for investors buying a stake in its oil pipeline business. Aramco’s debt-to-equity ratio more than doubled to 55% in 2020 from a year before, it said last month, after the group kept a pledge to deliver a $75 billion dividend to support state coffers despite a slide in profits.

Its “gearing” ratio - a measure of the degree to which Aramco’s operations are financed by debt - was 23% last year, compared to minus 0.2% at the end of 2019.

https://www.reuters.com/article/saudi-aramco-loans/saudi-aramco-to-refinance-10-billion-revolving-loans-sources-idUSL8N2MF56Z

>>47364

wnl sounds about right

go with dat

Another exec at China's biggest policy bank accused of graft

A former operating chief of China Development Bank, the nation's biggest policy lender, has been placed under investigation by the Communist Party's graft-buster on suspicion of taking bribes worth millions of yuan, sources with knowledge of the matter told Caixin.

Zhang Maolong, 68, is being investigated by the Central Commission for Discipline Inspection (CCDI) and the local anti-corruption agency in Beijing, according to an official statement released on Monday. The corruption watchdogs said Zhang was being investigated for "suspicion of serious violation in [party] discipline and law" a common euphemism for graft without giving details. The probe comes eight years after Zhang's retirement. Zhang joined CDB in 2000 and eventually became chief operating officer in 2010. He retired from the post in February 2013. During Zhang's three-year term, he received millions of yuan in bribes, including from a private company involved in the construction of a CDB branch office buildings, the sources said. The case of Zhang Linwu, a former senior CDB official who was put under investigation in January, also alleges bribes worth hundreds of thousands of yuan received from the same private company, the sources said. His case is connected with that of Zhang Maolong. Zhang Linwu, 50, served as president of the Chongqing branch of CDB from December 2014 to January 2016. He was removed from the position after his second ex-wife reported to the bank that he illegally reimbursed invoices worth thousands of yuan, people at CDB said. He later moved to one of the bank's project appraisal departments.

CDB has been hit by a string of graft scandals in recent years. In early January, former chairman Hu Huaibang was convicted of receiving bribes worth 85.5 million yuan ($13.2 million) from 2009 to 2019 in exchange for helping others with financing, business operations and promotions. In the same month, the CCDI said Yang Degao, a former vice president of the Hubei branch, had been expelled from the party. Yang was accused of taking bribes, illicitly making profits from issuing loans, and taking advantage of his position to benefit his relatives. Yang had helped a company in which he had a stake to illegally raise funds from the public at an annual interest rate as high as 70%, sources with knowledge of the matter said.

Also in January, Wang Xuefeng, a former president of the Shanxi provincial branch, was expelled from the party and removed from public office on suspicion of corruption. Wang was found to have taken a large number of bribes in exchange for facilitating financial deals, the CCDI said. CDB is the largest among China's three policy banks by assets, followed by the Agricultural Development Bank of China and the Import-Export Bank of China.

https://asia.nikkei.com/Spotlight/Caixin/Another-exec-at-China-s-biggest-policy-bank-accused-of-graft

>>47368

morning

RCH769T USAF C-17 Globemaster departed JBA ne after a ground stop-inbound from McGuire AFB

French AF FNY5013 and 5015 Dassault Falcon 50's inbound from Naval Base de Lann-Bihoue western France (Lorient) on descent for Spooktown VA-Norfolk Int'l Airport

>>47148 pb

RCH591T USAF C-17 Globemaster on ground at Buckley AFB, Denver from Travis AFB, CA depart after an overnight

>>47379

Kneepads continuing to avoid the southern border going to New Hampshire tomorrow

RCH769T USAF C-17 Globemaster on final approach turn for Nashua Airport, NH

Kamala Harris to visit New Hampshire with no plans yet for southern border trip

Plymouth and Concord, NH this Friday

https://nypost.com/2021/04/21/kamala-harris-to-visit-nh-with-no-plans-yet-for-southern-border-trip/

>>47388

check dat arrival airport

Manchester-Boston Regional instead of Nashua

>>47223 pb

Silver demand surging to its highest since 2015 - Silver Institute

Global silver demand will rise this year to its highest since 2015 as jewellery and industrial offtake rebounds after the coronavirus pandemic, helping to lift prices, the Silver Institute said in a report on Thursday. Silver is used in the manufacturing of goods from solar panels to consumer electronics, and is also bought by investors who traditionally see it as a safe store of wealth.

The pandemic triggered a rush of investor stockpiling but curtailed demand from industry and jewellers, particularly in India, one of the most important markets. All demand segments except for exchange traded funds (ETFs), which store silver for investors, will use more this year, and even ETFs will buy far more than was typical before the pandemic, the report said. Excluding ETFs, global silver demand will rise to 1.033 billion ounces in 2021 from 896.1 million ounces last year, according to the report compiled for the institute by consultants Metals Focus.

Silver supply will rise to 1.056 billion ounces from 976.2 million ounces in 2020, implying oversupply of 23.3 million ounces this year - the sixth consecutive annual surplus, though down from 80.1 million ounces in 2020. The report excludes ETFs from its physical demand figures because they do not remake silver into products, but only store wholesale silver bars.

ETFs will stockpile 150 million ounces this year, down from 331.1 million ounces in 2020, the report said. If those numbers are added to physical demand, the market will be undersupplied by 126.7 million ounces after a 251 million ounce deficit in 2020. Silver prices XAG=, currently around $26 an ounce, will average $27.30 an ounce this year, up from $20.55 in 2020 and the highest annual average since 2012, the report forecast.

https://www.nasdaq.com/articles/silver-demand-surging-to-its-highest-since-2015-silver-institute-2021-04-22