Credit Suisse considering options to plug capital hole

Credit Suisse Group CEO Tidjane Thiam speaks during a Bloomberg Television interview at the Credit Suisse Asian Investment Conference in Hong Kong, China, on Tuesday (March 28).
Credit Suisse Group CEO Tidjane Thiam speaks during a Bloomberg Television interview at the Credit Suisse Asian Investment Conference in Hong Kong, China, on Tuesday (March 28). PHOTO: BLOOMBERG

ZURICH (BLOOMBERG) - Credit Suisse Group, Switzerland's second-largest lender, is considering various options to plug a capital hole of as much as 4 billion francs (S$5.66 billion), chief executive officer Tidjane Thiam said.

Progress made by the Zurich-based bank in recent months means the firm can now consider alternatives to a longstanding plan to list part of its Swiss unit, Mr Thiam said in an interview with Bloomberg TV's Yvonne Man on Tuesday (March 28). The firm is not talking to investment banks about its capital raising plans, he said, declining to provide specifics.

"We know the market wants an answer, we know the market needs an answer, we're working diligently and we will give a very clear answer in due course," Mr Thiam said on the sidelines of his firm's annual Asian Investment Conference in Hong Kong. "It is a complex decision, which is why we're taking our time to make it."

Credit Suisse is in the second year of a turnaround plan that's been hampered by market turmoil, surprise trading losses and legacy issues. The bank is considering selling stock valued at more than 3 billion francs as an alternative to its longstanding plan to raise capital by listing part of its Swiss unit, people with knowledge of the matter said last week. It's even discussed raising as much as 5 billion francs, they said.

After tapping shareholders for 6 billion francs when the overhaul began in late 2015, Credit Suisse said it would seek to address further capital needs through the Swiss unit listing. A smaller-than-expected hit to buffers from a legal settlement over toxic mortgage securities in December has given the firm more options. Credit Suisse in recent weeks signaled to the market that the partial IPO is only an option among others to raise capital.