Feeling the Burn

Feeling the Burn

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  • Despite the decrease in value of its investment in Credit Suisse (CS), Saudi National Bank remains confident that its growth strategy will remain unscathed. On Monday, the bank reassured its stakeholders that the UBS-Credit (UBS) Suisse merger would have no effect on its future plans.
  • The Saudi National Bank suffered a loss of approximately $1.17 billion on its 307.6 million Credit Suisse shares due to the UBS-Credit Suisse merger, but the impact on its capital adequacy ratio is only 35 basis points, and its investment in Credit Suisse represents less than 0.5% of its total assets.

Why it matters

The Saudi National Bank, the kingdom's largest by assets, purchased approximately 9.9% of Credit Suisse for 5.5 billion riyals ($1.46 billion) last November and is currently the Swiss bank's major shareholder. In recent years, Middle Eastern investors have invested significantly in European banks like Credit Suisse, with mixed outcomes. The Qatar Investment Authority, another long-term supporter of Credit Suisse, has seen the worth of their 6.8% stake diminish following an increase in their stake in January.


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