Swiss banking giant Credit Suisse has had its ups and downs recently. See, the company hasn’t done the best job of risk management, meaning investors have been a little shaken. And it’s seen its share price fluctuate as a result of its upcoming turnaround plan. Speculations about its future have been brewing on social media since early this month, with investors worried that the company may need to raise billions of francs in capital.
On Tuesday, Bloomberg reported that the bank is looking at selling off its US asset management arm, which is a pretty big chunk of the company as a whole. The hope is that the asset management business will have some interest from private equity firms and other asset managers, but a final decision hasn’t been made yet on whether or not it will actually hang on to the branch.
It also had a massive blow on Tuesday over one of many cases related to how it was making mortgage-linked investments in the US, which was one of the things that led to the 2008 financial crisis. This settlement means the company will pay out nearly half a billion dollars to settle with the state of New Jersey. That’s no chump change.
“Credit Suisse is pleased to have reached an agreement that allows the bank to resolve the only remaining RMBS matter involving claims by a regulator," said the bank in a statement. “The settlement, for which Credit Suisse is fully provisioned, marks another important step in the bank’s efforts to pro-actively resolve litigation and legacy issues."
“The Swiss bank has recently begun a sales process for the US operations of Credit Suisse Asset Management, or CSAM," reported Bloomberg, citing unnamed sources familiar with the matter. “A final decision hasn’t been made on pursuing a sale, and Credit Suisse could opt to hold onto the unit, the people said."