Asset Management

BlackRock Reportedly Mulls Asset Management Purchase

Tom Burroughes Group Editor April 14, 2021

BlackRock Reportedly Mulls Asset Management Purchase

Credit Suisse, reports said, may be looking to increase its capital buffer after a series of bad losses linked to the failures of the Archegos investment entity and the Greensill Capital business involved in supply-chain finance.

The world’s largest fund manager, BlackRock, and a blank check firm are mulling the idea of buying Credit Suisse’s asset management unit, enabling the Swiss bank to restore capital after the Greensill and Archegos crises, media reports said.

BlackRock, which at the end of 2020 oversaw $8.7 trillion of assets, and a Special Purpose Acquisition Company of Jean-Pierre Mustier, former CEO of UniCredit, are considering buying the asset management business, Reuters and others reported.

Credit Suisse declined to comment; this news service has also contacted BlackRock for comment and may update.

Zurich-listed Credit Suisse is reviewing its asset management arm and has not yet engaged with interested parties about possibly spinning the business off. Switzerland’s second-largest bank may need to wait for its new chairman, former Lloyds Banking Group CEO Antonio Horta-Osorio, to take the helm before a decision is made, reports said.

Reports said that the business could be valued between $3.7 and $4 billion.

Separately, Credit Suisse announced that it is distributing another $1.7 billion of assets to investors hit by the collapse of supply-chain finance firm Greensill Capital, to which it has been exposed. And Credit Suisse has also reported that it expects to book a $4.4 billion charge from the demise of US-based hedge fund Archegos Capital Management, which had been structured as a family office.  

Credit Suisse has made further progress in winding down funds connected with Greensill Capital and is able to distribute another $1.7 billion to investors, the bank said today, taking total distribution so far to $4.8 billion.

Two senior C-suite executives at the bank have left following the Greensill/Archegos dramas, as previously announced. Brian Chin, investment bank chief executive, steps down at the end of April. Lara Warner, chief risk and compliance officer, is also stepping down from her role on the executive board. Both will be leaving

the bank. Christian Meissner has been appointed as CEO of the investment bank and as a member of the executive board.

(Editor's comment: This story may be pure speculation at this stage, but it is worth noting that at $8.7 trillion of AuM, BlackRock is already by far the largest manager of market assets in the world, and if it were to make further purchases, it might ring some anti-trust alarm bells. At what point do policymakers in Washington DC argue that a firm with this level of buyside power may have too much of it?)

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