Several large private banking clients reportedly withdraw assets, among them rich families in Asia and the Middle East.
Several wealthy families in Asia as well as in the Middle East are withdrawing «hundreds of millions of dollars» due to the health of the troubled Swiss lender, with bankers at rival firms apparently taking advantage of the concerns, according to a «Bloomberg» report that cited unnamed sources.
The report indicated that some clients in Singapore and the Middle East had made requests to withdraw cash or shift assets in the tens of millions of dollars or more. One Asian family office that pulled out cash said it was told by the bank that there was a queue of unprocessed transactions that had resulted in some temporary backlogs.
In Close Contact
«We are in close contact with our clients as we are working on the strategic review,» said a spokesman for Credit Suisse, which managed almost $770 billion for wealthy clients at the end of June. Figures on outflows or inflows «are disclosed as usual on a quarterly basis.»
Trying to provide reassurance, Credit Suisse private bankers have counteracted the ostensible efforts underway at competitors by proposing that assets be shifted to third-party fiduciaries. They have also been making recommendations that clients invest in short-dated US treasury bills that limit exposure.
AuM Threatened
Credit Suisse is facing a myriad of challenges including wide-ranging questions about how it will finance a long-awaited restructuring of its investment bank, a step that is expected to be announced at the end of October when third-quarter results are released.
The bank’s balance sheet came under scrutiny early last week after its credit default swap spreads had spiked as high as 355 basis points. Credit Suisse subsequently bought back $3 billion in its own debt on Friday, likely alleviating some of those concerns.
