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by 3 minutes Read (Reuters) – Zurich (Reuters) – Credit Suisse’s asset management arm announced on Friday that it will pay out another $750 million to investors in its Greensill-linked supply chain finance funds. FILE PHOTO: On October 28, 2020, the logo of Swiss bank Credit Suisse is visible at a branch office in Bern, Switzerland. Arnd Wiegmann/Arnd Wiegmann/Arnd Wiegmann/Arnd Wiegmann/ It stated on Friday that it had recovered $6.1 billion of the $10 billion in money guaranteed by insolvent supply chain finance business Greensill Capital, a little rise from the $5.9 billion it had recovered through late May. The funds’ failure in March set off a difficult era for the bank, culminating in a multibillion-dollar loss linked to family office Archegos, a slew of managerial departures, and an anticipated upheaval as top management battles to keep the bank afloat. The additional payments, which are set to begin the week of July 5, will bring the total amount paid to investors from the liquidation proceeds to $5.6 billion. In the note, Credit Suisse stated, “Further liquidation profits are likely to be paid out to investors as soon as practical in future installments.” “At this time, we are unable to provide specific timeframe for the next cash payouts.” Credit Suisse is concentrating on $2.3 billion in Greensill loans to three single counterparties, the largest of which being Sanjeev Gupta’s GFG Alliance, who are having repayment concerns. It said on Friday that as of June 29, it had accrued nearly $2.3 billion in late payments, with $1.8 billion connected to so-called “priority areas” comprised of these three groupings and $500 million related to single-counterparty exposures. The company is in talks with mining mogul Gupta over the $1.2 billion in exposure his funds have to his wholly-owned GFG Alliance, which is the fund’s single largest pool of at-risk assets. The two companies negotiated a six-week standstill agreement on GFG’s Australian steel and coal mining assets in late June, in the hopes of allowing the company to refinance the operations. Credit Suisse has also discussed a $440 million exposure with Softbank-backed construction firm Katerra, as well as a $690 million exposure with West Virginia governor Jim Justice’s coal company Bluestone Resources. Katerra filed for bankruptcy in June, anticipating $1 billion to $10 billion in liabilities and $500 million to $1 billion in assets. Credit Suisse anticipates insurance to kick in on some of these exposures if payments aren’t paid, and the bank is seeking for similar insurance, notably from Tokio Marine in Japan. Tokio Marine’s Bond and Credit Company (BCC) had offered $4.6 billion in coverage to Greensill credit notes, so indirectly covering some Credit Suisse funds as a “loss payee.” Brenna Hughes Neghaiwi contributed reporting, and John Revill edited the piece./nRead More

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