You are here: Home » International » News » Companies
Business Standard

Credit Suisse made $17.5 mn in Archegos fees in year before $5.4 bn losses

The lenders have collectively lost more than $10 billion in the fallout

Credit Suisse | Hedge funds


Credit Suisse
Photo: Bloomberg

Archegos, which was run by former hedge fund manager Bill Hwang, borrowed tens of billions of dollars from at least nine global banks to speculate on volatile stocks. The lenders have collectively lost more than $10 billion in the fallout.

According to a report by the Financial Times, despite extending billions of dollars of credit to Archegos, made just $17.5 million from the relationship last year. The low level of fees and high risk exposure have caused concern among the board and senior executives, who are investigating the arrangement, according to two people with knowledge of the process.

The bank’s management is particularly alarmed after being told that Hwang was not a private banking client of the group, suggesting there was little incentive to pursue his prime brokerage business, the people told FT. According to the news article, also demanded a margin of only 10 percent for the equity swaps it traded with Archegos and allowed the family office 10-times leverage on some transactions, according to people familiar with the trades and first reported by

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Tue, May 04 2021. 00:28 IST