The Swiss bank has attracted 20 banks to bring the much-needed capital increase of 4 billion Swiss francs to a successful conclusion.

Credit Suisse is going through the biggest crisis in the bank’s 166-year existence. The reputation of Switzerland’s second largest lender has been tarnished by a series of scandals, such as the loss of $ 5.5 billion due to the breakup of the US investment fund Archegos.

Credit Suisse also had to freeze $ 10 billion of funds linked to the insolvent British financier Greensill.

Radical plan

To strengthen the balance sheet, the bank announced a major restructuring plan last week, in which 9,000 of the 52,000 jobs will disappear over the next three years. Furthermore, the focus is shifted from investment banking to less volatile asset management. In addition, 4 billion Swiss francs would be issued for new shares.

Investors such as the Saudi National Bank have already committed around 1.76 billion francs (1.77 billion euros). They are going to buy shares at 3.82 Swiss francs apiece, a 6 percent discount on the average price on Thursday and Friday, Credit Suisse said in a statement on Monday. The Saudi National Bank is expected to buy around 307.6 million new shares, giving the new investor a 9.9 percent stake in Credit Suisse and becoming a reference shareholder.

Credit Suisse intends to raise the rest of the fresh capital by offering 889 million euros of new shares to existing shareholders. To this end, Credit Suisse has set up a syndicate of around 20 banks to oversee the sale. Among them, such well-known names as BNP Paribas, Goldman Sachs and Deutsche Bank.

The price per share is fixed at 2.52 Swiss francs per share. Seven preference rights are expected to give the holder the right to buy two new shares at a 32 percent discount on the reference price.

The capital operation has yet to be approved at an extraordinary general meeting on november 23. The final terms of the claims issue are expected to be announced the following day.

If the shareholders reject the plan, Credit Suisse will issue 1.8 billion new shares at an offer price of 2.27 Swiss francs per share, which could still raise 4 billion Swiss francs. Analysts at JP Morgan expect the capital increase to have a diluting effect of around 27 percent.

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