Chairman of Saudi National Bank resigns after remarks that tanked Credit Suisse
The chairman of Saudi National Bank stepped down just days after making comments that led to Credit Suisse being absorbed by rival UBS.
Ammar al Khudairy announced his resignation on Monday, citing “personal reasons.” He had been chairman of the bank since 2021. Al Khudairy will be replaced by SNB Managing Director and Group CEO Mohammed al Ghamdi. Talal Ahmed al Khereiji will be the new SNB acting CEO.
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Al Khudairy drew controversy amid the fallout from Silicon Valley Bank’s collapse when he said that Saudi National Bank, the largest shareholder of Credit Suisse, would not be increasing its stake, given regulatory constraints.
Following the remarks, Switzerland-based Credit Suisse’s stock fell more than 24%. The news at the time dragged down banking stocks more broadly, including other big banks such as JPMorgan Chase and Goldman Sachs.
The Swiss central bank agreed to loan Credit Suisse up to more than $50 billion to shore up confidence in the megabank, although that proved to not be enough, and Swiss competitor UBS then agreed to buy out fellow Swiss competitor Credit Suisse (with support from Swiss authorities).
Under the terms of the proposed purchase, UBS agreed to purchase Credit Suisse for just over $3 billion, a mere fraction of the firm’s estimated value.
“The SNB Chairman was a victim of giving his honest opinion at such a tense time for Credit Suisse. In hindsight, seeing the buyout rate of CS by UBS, his answer was the right course of action: awaiting for the crisis to be clearer,” Mohammed Ali Yasin, a capital markets specialist and investment adviser, said, according to Bloomberg.
The Saudi kingdom’s sovereign wealth fund owns a 37% stake in Saudi National Bank.
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In stateside banking news, the Federal Deposit Insurance Corporation announced overnight that North Carolina-based First Citizens Bank agreed to purchase some $72 billion of SVB’s assets for a discounted $16.5 billion and the transfer of deposits worth $56 billion, according to the FDIC.
The move caused the shares of regional banks across the country to surge on Monday morning after the stock market opened.