CS ties up with Gulf firms to issue $6.2bn notes
Zurich, February 14, 2011
Credit Suisse Group said it has sealed an agreement with its key Gulf investors, Qatar Holding and Saudi-based Olayan Group, to issue an aggregate of CHF6 billion ($6.17 billion) of Tier 1 buffer capital notes.
This form of contingent capital will satisfy an estimated 50 per cent of the high trigger contingent capital requirement under FINMA rules as part of the proposed Swiss TBTF-regime, said the leading financial services provider in a statement.
Commenting on the agreement, Brady W. Dougan, Credit Suisse chief executive officer, said: “We are pleased to announce a definitive agreement with Qatar Holding and The Olayan Group, to issue an aggregate of approximately CHF 6 billion of Tier 1 buffer capital notes to be paid up no earlier than October 2013.'
'We have worked in close co-operation with our primary regulator, Finma, to ensure that the buffer capital notes will qualify under the future Swiss capital rules as contingent capital. With this exchange, we will satisfy an estimated 50 per cent of our high trigger contingent capital requirement set by Finma.'
'Issuing contingent capital such as these buffer capital notes is an important part of our efforts to further strengthen our capital base. With the continuing support and partnership of Qatar Holding and The Olayan Group, we are well ahead of schedule to meet the new capital requirements by 2019,” said Dougan.
Ahmad Al-Sayed, managing director and chief executive officer of Qatar Holding, said: “We sees this transaction as an enhancement to our existing investment, and we believe it will support our objective of generating long-term stable returns.'
'We continue to support Credit Suisse Group’s endeavors to remain at the forefront of the evolving regulatory and capital regimes,” he added.-TradeArabia News Service