C Suisse CEO says bank not caught short

Tidjane Thiam

Credit Suisse CEO Tidjane Thiam said hedge funds are wrong to assume that the bank will have to raise additional capital after the shares touched a fresh all-time low last week, according to two people with knowledge of the matter.

Bloomberg News reports that the bank’s share price is hurt by “an unusually high level of short positions,” Thiam wrote in a memo to staff last week, the people said, asking not to be identified because the contents are private. While some hedge funds are speculating on another capital increase, partly because of restructuring measures and operational losses, they’re “not correct,” Thiam wrote.

Thiam, 53, has struggled to restore profitability and reverse a drop in shares, which has eroded about half the company’s market value since he took over in July. As part of his overhaul announced last year, the CEO raised $6.3bn, while seeking to eliminate thousands of jobs and cutting back the securities unit to focus on wealth management.

Credit Suisse shares have lost about 42% this year, touching the lowest since at least 1989 on June 16, data compiled by Bloomberg show. The slide has left them the sixth-worst performers on the 39-member Bloomberg Europe Banks and Financial Services Index, which slipped 21%.

To access the complete Bloomberg News article hit the link below:

Credit Suisse CEO Said to Tell Staff Shorts Wrong on Capital

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