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Bond Market News

Credit Suisse Plans $500mn Capital Raise via Exchangeable Bond

February 7, 2023

Credit Suisse is planning to raise $500mn via a capital raise via a 5Y exchangeable bond, paying 6% coupons. Investors participating in the capital raise will have to swap their notes into shares of its investment banking carve out, Credit Suisse First Boston (CSFB) in the event of a spin-off or an IPO. CSFB is said to be targeting an IPO in 2024 or 2025, as per sources. The parent swiss-bank said that CSFB is expected to see revenues of ~$3.5bn over the longer term after estimating a 43% rise in net revenues in 2023 to $2bn. This comes after its revenues fell by 69% in 2022.

CSFB is expected to be regulated as a non-bank. Reuters notes that it could give the business an “edge on compensation”. At the time of an IPO of CSFB, investors would have to convert their notes into shares, which they would receive at a 10% discount to the listing price. If a deal does not go through, investors would receive 103% of the principal at maturity.

CS dollar bonds were slightly lower – its 9.75% Perp was down 0.75 points to 96.8, yielding 10.75%.

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