Credit Suisse sells stocks tied to Archegos Capital blowup

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Credit Suisse sells stocks tied to Archegos Capital blowup

- Credit Suisse Group AG started unloading stocks tied to the Archegos Capital bankruptcy more than a week after some rivals dumped their shares and cut losses.

ViacomCBS Inc. hit the market with block trades that had more than$ 2 billion at current prices, said a person with knowledge of the matter. The stocks are substantially below where they were last month before Bill Hwang's family office imploded.

The shares of the three companies declined in postmarket trading as did US-listed shares of Credit Suisse.

The Zurich-based firm has yet to provide investors with an update on the extent of the hit it faces from its relationship with Archegos, but it could run into the billions of dollars, according to people with knowledge of the matter. Credit Suisse's investment bank chief Lara Warner is expected to leave and leaders are also discussing removing Chief Risk Officer Brian Chin.

Read more: CCN to depart bank following the archegos Fiasco in France.

The collapse of Bill Hwang's Archegos portfolio has turned into one of the biggest fund burnouts since the end of Long-Term Capital Management in the 1990 s. Archegos had grown rapidly on the back of heavily leveraged bets.

These came to an end within days late last month as stocks such as ViacomCBS and GSX Techedu Inc. tumbled, triggering margin calls. Nomura Holdings Inc. and Credit Suisse shareholders have told them that their businesses face significant losses.

Archegos and Morgan Stanley, which were among the first banks to liquidate Goldman Sachs Group Inc. holdings, seem to have avoided major damage to their businesses. According to Archegos' size, banks could accrue total losses as positions get unwound, said JPMorgan Chase Co. analysts led by Kian Abouhossein in a note to clients last week.

The Credit Suisse offering on Monday was large- around 34 million shares in Farfetch, 14 million shares of ViacomCBS and 11 million shares of Vipshop, but this is still a fraction of the size that banks traded last week by banks.

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