Signs hang at the entrance of a branch of Credit Suisse Group in Zurich, Switzerland, on Sunday, September 9. January 25, 2022. Inflation in Switzerland has more than doubled since the start of the year, and the State Secretariat for Economic Affairs expects it to hit a three-year high of 3% in 2022.Photographer: Pascal Mora/Bloomberg via Getty Images
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Troubled Credit Suisse on Friday offered to buy back as much as 3 billion Swiss francs ($3.03 billion) in debt securities in response to a slump in share prices and rising bets on debt.
The Swiss bank also confirmed it was selling its famous Savoy hotel in Zurich’s financial district, prompting some speculation it was competing for liquidity.
In a statement on Friday about repurchasing debt securities, Credit Suisse said: “These transactions are in line with our aggressive approach to managing our overall liability composition and optimizing interest expense, and allow us to take advantage of market conditions to repurchase debt at attractive prices. “
It comes after Credit Suisse shares briefly fell to a record low earlier this week, while credit default swaps hit a record high and markets were jittery about its future.
After a series of scandals and risk management failures, the troubled lender is undergoing a massive strategic review under its new chief executive and will close on Oct. 27.
The most costly of the scandal was the bank’s $5 billion exposure to hedge fund Archegos, which collapsed in March 2021. Credit Suisse has since overhauled its management team, suspending share buybacks and cutting its dividend in an attempt to shore up its future.
Shares closed at 4.22 Swiss francs on Thursday. They are down more than 50% year to date.
On Friday, the bank announced a cash offer of up to 1 billion euros ($980 million) in 8 euro- or sterling-denominated senior debt securities, and up to $2 billion in 12 dollar-denominated securities. The offer for the debt securities will expire in November. 3 and Nov. 10, respectively.