Saudi investors lose billions in Credit Suisse crisis
The Saudi National Bank (SNB), which is Credit Suisse’s top shareholder, has had its US$ 1.5 billion investment almost wiped out, while the Saudi-based Olayan family also suffered huge losses.
Credit Suisse, which has been struggling for months, sought help from the Swiss government this week. An emergency deal was eventually brokered on Sunday to secure the bank’s future and prevent more chaos in the markets.
No more money for Credit Suisse— Bloomberg TV (@BloombergTV) March 15, 2023
That's what Saudi National Bank Chairman Ammar Abdul Wahed Al Khudairy told @youseftv when asked about more assistance for the troubled lender https://t.co/GFLboCOwyj pic.twitter.com/iSjco40v8D
Crown Prince Mohammed bin Salman, widely seen as Saudi Arabia's de facto ruler, had reportedly instructed the government-backed Saudi National Bank to make a massive investment last year when riding the boom in oil prices following Russia’s invasion of Ukraine.
Saudi banks have only recently begun to invest in foreign banks and institutions as part of Riyadh’s ambition to diversify the sources of its income and reduce its reliance on fossil fuels in the long term.
The investments were meant to be the kingdom’s big splash in the global markets to affirm its status as an investing powerhouse backed by its oil reserves.
The global banking sector was thrown into chaos after the collapse of the Silicon Valley Bank in the United States on 10 March, making it the second-largest banking failure in US history.
The collapse has led to uncertainty across the industry, leading to worries that it could spark a collapse akin to the 2008 financial disaster that plunged several Western economies into recession.