Archegos debacle prompts Credit Suisse to slash prime services
Executives pledged $35 billion of cuts to investment bank leverage exposure
Credit Suisse’s chief pledged to cut its prime brokerage by one-third in the wake of the Archegos blow-up, which contributed to a 70-basis point drop to the bank’s core capital ratio over the first quarter.
At end-March, the embattled lender’s Common Equity Tier 1 (CET1) capital ratio was 12.2%, down from 12.9% at end-2020. The CET1 leverage ratio fell to 3.8% from 4.4%. The Archegos implosion incurred Sfr4.4 billion ($4.7 billion) of losses in Q1, and managers expect a further Sfr600 million
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