ZURICH: Credit Suisse shareholders on Wednesday approved a 4 billion Swiss franc ($4.20 billion) equity capital hike earmarked to finance the embattled Swiss bank’s turnaround.
Some 92% and 98% of shareholders at an extraordinary general meeting supported the two share capital increases which were first proposed last month under the scandal-prone bank’s restructuring plan.
“Today’s vote by shareholders marks a further important step in our journey to build the new Credit Suisse” chairman Axel Lehmann said.
“This vote confirms confidence in the strategy, as we presented it in October, and we are fully focused on delivering our strategic priorities to lay the foundation for future profitable growth,” he added.
The approval came after Credit Suisse on Wednesday announced it expects a pre-tax loss of up to 1.5 billion Swiss francs ($1.58 billion) in its fourth quarter, saying the “challenging” economic and market environment had an adverse effect on client activity across its business.
The warning sent Credit Suisse’s shares reeling, with the stock down 4.8% in morning trading, while the cost of insuring the bank’s debt against default also rose.
To fund an overhaul which will see it cut thousands of jobs and scale back its investment bank, Credit Suisse had drawn up a plan that would give new and existing shareholders the chance to buy new shares.
Switzerland‘s second-largest bank said last month that new investors had committed to buy 462 million new shares at a purchase price of 3.82 Swiss francs ($3.83), equivalent to 94% of the volume-weighted average price of Credit Suisse shares on October 27 and 28, raising 1.76 billion Swiss francs.
Some 307.6 million of the new shares are expected to be bought in private placement by Saudi National Bank, giving it a 9.9% stake in Credit Suisse.
Shareholders on Wednesday also agreed to a rights offer that gives existing investors the option to buy 889 million shares at 2.52 francs per share, with subscription rights corresponding to the size of their present stake.
The final terms of the rights issue are expected to be announced on Thursday.
Some 92% and 98% of shareholders at an extraordinary general meeting supported the two share capital increases which were first proposed last month under the scandal-prone bank’s restructuring plan.
“Today’s vote by shareholders marks a further important step in our journey to build the new Credit Suisse” chairman Axel Lehmann said.
“This vote confirms confidence in the strategy, as we presented it in October, and we are fully focused on delivering our strategic priorities to lay the foundation for future profitable growth,” he added.
The approval came after Credit Suisse on Wednesday announced it expects a pre-tax loss of up to 1.5 billion Swiss francs ($1.58 billion) in its fourth quarter, saying the “challenging” economic and market environment had an adverse effect on client activity across its business.
The warning sent Credit Suisse’s shares reeling, with the stock down 4.8% in morning trading, while the cost of insuring the bank’s debt against default also rose.
To fund an overhaul which will see it cut thousands of jobs and scale back its investment bank, Credit Suisse had drawn up a plan that would give new and existing shareholders the chance to buy new shares.
Switzerland‘s second-largest bank said last month that new investors had committed to buy 462 million new shares at a purchase price of 3.82 Swiss francs ($3.83), equivalent to 94% of the volume-weighted average price of Credit Suisse shares on October 27 and 28, raising 1.76 billion Swiss francs.
Some 307.6 million of the new shares are expected to be bought in private placement by Saudi National Bank, giving it a 9.9% stake in Credit Suisse.
Shareholders on Wednesday also agreed to a rights offer that gives existing investors the option to buy 889 million shares at 2.52 francs per share, with subscription rights corresponding to the size of their present stake.
The final terms of the rights issue are expected to be announced on Thursday.
For all the latest business News Click Here
Denial of responsibility! TechAI is an automatic aggregator around the global media. All the content are available free on Internet. We have just arranged it in one platform for educational purpose only. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials on our website, please contact us by email – [email protected]. The content will be deleted within 24 hours.
