Investment banking giant Credit Suisse Group AG is set to undertake reorganization efforts in efforts to prevent the fallout following the Archegos implosion.
- Credit Suisse said it will cut its links with hedge funds, and instead focus on its core business of catering to the global rich. It will focus on flagship private banking and wealth-management arms under one roof.
- The firm targets to hit $1.2 trillion assets under management by 2024, up from the $1 trillion it has now. It will also reduce investments in its arm responsible for over $5 billion in losses due to the Archegos fallout.
- The restructuring is set to help the bank avoid being acquired by a bigger rival, with its Asian business seen as attractive by competitors such as Goldman Sachs and Morgan Stanley.
- The bank started to notify clients of the decision to exit the prime brokerage business on Thursday and expects most of the balances to be shifted by the end of the year.
Credit Suisse expects to incur losses in the last three months of 2021, due to fresh impairments and another write down.
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