Most of Credit Suisse’s investment banking division could reportedly be put on sale or spun off as the Swiss lender aims to create a «capital-light» unit.
As much as two-thirds of Credit Suisse’s investment banking division could be put on sale or spun off, according to a «Bloomberg» report citing unnamed sources.
This includes fixed income trading, leveraged finance, debt capital markets and equity capital markets. Equity trading revenues have evaporated following a prime brokerage exit last year while the securitized product unit is seeking partners with the support of Centerview advisors.
Only the mergers and acquisitions advisory team appears to be relatively secure.
Deal Options
According to the report, sales or spinoffs could be considered for any part of the investment bank that still retains value. One option that is not imminent is a Credit Suisse takeover – a matter that first emerged in headlines in June following rumors of an acquisition by State Street that have been denied.
Investment banking co-head David Miller said in a recent town hall meeting that the aim was to transform the unit to become «capital-light» and «advisory-focused».
Meanwhile, sources added that they believe Swiss authorities want to give Credit Suisse's top management time to deliver their solution and seek an orderly restructuring that does not jeopardize the bank's health.
«We will update on progress on our comprehensive strategy review when we announce our third-quarter earnings; any reporting on potential outcomes before then is entirely speculative,» said a spokesperson for Credit Suisse.
