Troubled Swiss lender offloading assets to stay afloat
Swiss banking giant Credit Suisse said on Thursday it is selling its renowned Savoy Hotel in Zurich’s financial district. The announcement comes amid growing investor concerns about the bank’s financial health.
Credit Suisse stated that it had put the 184-year-old hotel on Paradeplatz in the heart of the city’s financial district on the market as part of a regular review of its global real estate assets. It is reportedly selling the five-star hotel for as much as 400 million Swiss francs ($404 million).
“As part of this process, the bank has decided to start a sales process for the Hotel Savoy,” the bank’s spokesperson said as quoted by the Guardian. “We will carefully assess all offers and potential investors and communicate any decision in due course.”
The announcement comes as the bank, whose stock has fallen by around 50% in the past six months, is at the center of market turmoil, following a string of scandals. Credit Suisse’s shares briefly sank to an all-time low earlier this week, and credit default swaps hit a record high, amid uncertainty over its future.
The bank racked up billions of dollars in losses from the 2021 collapse of hedge fund Archegos and financial services firm Greensill. Credit Suisse has since overhauled its management team, suspended share buybacks and cut its dividends. It is now preparing to unveil a costly restructuring plan, due later this month.
Speculation that one of Europe’s largest banks could fail has sparked comparisons with the 2008 crash of US investment bank Lehman Brothers, which precipitated the worst economic crisis since the Great Depression. However, many economists have been cautioning against such parallels, claiming that the global financial environment had changed significantly since Lehman Brothers went bankrupt.
On Friday, the embattled lender offered to buy back up to three billion Swiss francs (over $3 billion) of debt securities.
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