Saudi National Bank appoints a new chairman after Credit Suisse’s losses
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The Saudi National Bank has appointed a new chairman. The appointment comes after the bank recorded significant losses on its investment. Saudi National Bank was the largest shareholder in Credit Suisse, which UBS Group recently acquired.
Saudi National Bank appoints a new chairman
The Saudi National Bank had already announced that it would not provide any more funding to the troubled Credit Suisse, which triggered a plunge in the Swiss lender’s shares to an all-time low and forced the lender’s acquisition by UBS Group. Now, Saudi National Bank is replacing its chairman shortly after reporting losses after Credit Suisse’s fiasco.
The CEO of the bank, Saeed Mohammed Al Ghamdi, noted that he would take over as the new chairman. He will be taking over from Ammar Al Khudairy, the previous chairman. The bank said that the resignation of the former chairman was due to personal reasons.
The deputy CEO of the bank, Talal Ahmed Al Khereiji, will become the new CEO of Saudi National Bank. These changes are effective from March 27, with the development coming around two weeks after Al Khudairy said that the largest bank by assets in Saudi Arabia would not purchase any more shares in Credit Suisse.
The decision by Saudi National Bank not to make additional investments in Credit Suisse triggered a sell-off in the bank’s shares. The lender had already reported an influx in withdrawals as clients pulled out over $110 billion from the bank in the past three months of 2022.
The plunge in Credit Suisse shares came amid jitters in the banking sector. The collapse of two leading US banks, Silicon Valley Bank and Signature Bank, triggered a global plunge across bank stocks, and Credit Suisse was among the most affected banks.
Saudi National Bank made losses from the Credit Suisse collapse
The remarks made by Al Khudairy on Saudi National Bank not continuing its investment in the lender resulted in Credit Suisse losing around a fifth of its value. The situation forced the lender to undergo a takeover by its rival, UBS. UBS Group offered to acquire Credit Suisse for $3.2 billion, with the acquisition slated to end by the end of the year.
The Saudi National Bank was among the largest investors in Credit Suisse. In November last year, the bank acquired around 9.9% of Credit Suisse for $1.46 billion. Following the bank’s collapse, the Saudi National Bank has lost over $26 billion in market value since October after committing to the investment.
By last week, the Saudi National Bank was sitting on a loss of over $1 billion. However, on March 20, the bank said that the drop in investment value did not affect its growth plans and it would have an impact on profitability.
Earlier this month, Al Khudairy said the bank was not exploring any international acquisitions. Instead, the former chairman said that the bank remained focused on its business in Saudi.
