Is Saudi’s Crown Prince considering investing in Credit Suisse Unit?
According to sources telling the Wall Street Journal, investors including Saudi Arabia’s Crown Prince and a private-equity firm run by a former Barclays CEO have expressed interest in investing $1 billion or more in Credit Suisse’s new investment banking unit.
The sources revealed that Crown Prince Mohammed bin Salman is thinking about investing about $500 million to support the newly formed CS First Boston (CSFB) and its CEO-designate Michael Klein. However, the bank has not yet received a formal proposal from any Saudi entity.
According to the report, which cited people with knowledge, additional financial support could come from American investors, including former Barclays CEO Bob Diamond’s Atlas Merchant Capital.
In October, Credit Suisse announced that it would reorganize its investment bank by reviving the First Boston brand in an effort to breathe new life into a sluggish business. Klein, a board member, was chosen by the bank to head CSFB.
Saudi National Bank (SNB), controlled by the government of Saudi Arabia, had previously committed to investing up to 1.5 billion Swiss francs ($1.60 billion) in Credit Suisse itself for a stake of up to 9.9 percent and had also stated that it may support the standalone CSFB, which will function as separate capital markets and advisory bank with its headquarters in New York.