Credit Suisse Spin-Off Launched Ahead of Planned IPO

The new subsidiary is seen as a big step towards IPO which is planned for H2 2017.

Credit Suisse announced today that the new Swiss legal entity Credit Suisse (Schweiz) AG has commenced operations. The Swiss lender has moved over 1 million customers into the new subsidiary in a move towards what may result in Switzerland’s biggest stock market listing in over 10 years.

Wealth Management Focus

The new subsidiary, Credit Suisse (Schweiz) AG, which looks after Swiss retail, corporate, private and investment banking clients, is part of a broad shake-up of Credit Suisse under Group CEO Tidjane Thiam aimed at focusing more on wealth management and less on volatile investment banking.

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It is also part of Swiss efforts to safeguard the country’s economy from another banking crisis by getting major banks to ring-fence parts of their business.

Thiam commented: “The creation of Credit Suisse (Schweiz) AG is not only about the implementation of new regulatory requirements but also allows our Swiss business to build on the positive development over the past few quarters and gain further market shares in our crucially important home market.”

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Planned IPO

The planned IPO is expected to take place in H2 2017. Credit Suisse is looking to raise CHF 2-4 billion by selling 20-30 percent of Credit Suisse (Schweiz) AG. It is hoped that the listing will highlight the part of Credit Suisse the bank believes is undervalued while also paving the way for acquisitions of smaller Swiss banks.

A valuation at the top end of the range would make it bigger than any Swiss initial public offering since 2001. The banking group currently has a market capitalisation of around CHF 30 billion, according to Thomson Reuters data.

Referring to the initial public offering (IPO) plans, Frank Schubert, project leader for the Swiss legal entity, said: “Setting up the legal entity is a pre-condition on the way to the IPO.”

Thomas Gottstein, CEO of Credit Suisse (Schweiz) AG, concluded: “We are convinced that our focus on the Swiss market and on serving clients domiciled in Switzerland will prove successful. Also, it underscores our strong commitment to the Swiss market where our bank has been serving private, corporate and institutional clients, including entrepreneurs throughout its 160 years of history.”

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