Credit Suisse office in Warsaw, Poland. (Kacper Pempel/Reuters)
Credit Suisse Group AG is considering selling stock valued at more than 3 billion Swiss francs ($4.03-billion) as an alternative to its long-standing plan to raise capital by listing part of its Swiss unit, according to people with knowledge of the matter.
Credit Suisse may sell new shares representing up to 10 per cent of its outstanding stock, or about 3.1 billion francs, through an accelerated sale to money managers, which wouldn’t need investors to sign off, the people said, asking not to be named as the details aren’t public.
The sale could exceed that amount.
The lender has spoken with some advisers about raising as much as 5 billion francs, subject to shareholder approval, the people said.
“A capital raise is a good idea,” said Peter Casanova, a Kepler Cheuvreux analyst with a buy rating on the stock.
“I’d prefer to see a capital hike compared to an IPO.”
An initial public offering involves more costs and would require Credit Suisse to forgo one of its most important assets, he said.
Credit Suisse is in the second year of a turnaround plan to shrink its securities business while expanding in its wealth management department .
After tapping shareholders for 6 billion francs when the overhaul began in late 2015, Credit Suisse said it would seek to address further capital needs by listing part of the Swiss unit.
A smaller-than-expected hit to buffers from a legal settlement over toxic mortgage securities in December has given the firm more options.
No final decisions have been made and Credit Suisse may decide against a share sale, the people said.
Meanwhile, preparation is continuing on the IPO, one of the people said.
A representative for Credit Suisse declined to comment.