How do you lose $6 billion ?

So Credit Suisse dusts $4.7 billion while doing business with Archegos and perhaps a further $1.5 billion for working with Greensill Capital.

(= to 25% of its market cap)

Aren’t these types of financial institutions touting themselves as the ‘best of the best’?

Once again, people have handed over money into investments, funds or products which they may not know what is inside them…..and in some cases, redeeming your money is neither quick nor possible.

Extracts from the article;

“The firm will take a 4.4 billion franc ($4.7 billion) writedown tied to its Archegos exposure”

? Why does it have ‘exposure’ ?
? What counter-party risk exists or was taken ?
? I wonder if assets have been hypothecated over and over again ?

“The firm is still set to give an update on the effect of last month’s collapse of Greensill Capital, which helped manage $10 billion of investment funds the Swiss bank offered to clients.”

This next sentence floors me….

“Credit Suisse is leaning toward letting clients take the hit of expected losses in those funds, a person familiar with the discussions said.”

? Do they mean to say, Credit Suisse pondered wearing the loss for clients ?
? If so, what does that imply ?

Hear what is not being said.

April 7, 2021
by Rob Zdravevski

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