Credit Suisse will close down the $ 10bn (£ 7.2bn) expert investment that has been heavily invested in loans linked to Greensill, a troubled bank.
Greensill, who employs 1,000 workers in London and former prime minister David Cameron as a consultant, is preparing to apply for insolvency and is in talks to sell parts of the business to American corporation Apollo Global Management, after losing support from Credit Suisse and its Swiss investment firm GAM.
Both Greensill and Apollo declined to comment.
Funds Termination
“The fund boards have now decided to terminate the funds. Credit Suisse Asset Management’s priority is to ensure a balance between a timely liquidation of the funds and maximizing value for the investors,” the Swiss bank said on Friday.
Credit Suisse said it was closing these funds due to valuation uncertainties,, reduced access to new investment insurance, and the challenges of finding a suitable investment.
About Greensill
Greensill provides supply chain finance, lending businesses money to pay their suppliers in return for a fee. It secured funding by passing on the load to investors, through funds such as the ones Credit Suisse is closing. The Swiss bank is thought to have about 1,000 clients with cash invested in Greensill-linked funds.
Greensill’s troubles escalated on Monday during a court battle in New South Wales, Australia, where the headquarters are located. The bank, founded by Australian finance expert Lex Greensill, hoped to prevent the insurance company from withdrawing protection. Loss of credit has triggered a series of measures by Credit Suisse to reduce exposure to its customers.
On Monday, Credit Suisse suspended redemptions as well due to concerns about its efficiency and value, and on Wednesday it said it hoped to reimburse shareholders.
Credit Suisse said the funds were offset by a “decline in access to new investment insurance”, but declined to say whether existing funds were protected.
