Saudi National Bank, which was the largest shareholder in Credit Suisse, named a new chairman on Monday following the former head's resignation weeks after comments he made helped propel the plunge of the beleaguered Swiss bank's share price.
Ammar Al Khudairy resigned as chairman of SNB due to "personal reasons," according to a statement from the bank. Current CEO Saeed Mohammed Al Ghamdi will take over as the new chairman on March 27, with deputy CEO Talal Ahmed Al Khereiji filling his place.
This change will take place about two weeks after Khudairy said SNB, Saudi Arabia’s biggest bank by assets, would not buy more shares of Credit Suisse on regulatory grounds.
“Absolutely not, for many reasons,” Khudairy told Bloomberg at a March 15 conference in Saudi Arabia. “I’ll cite the simplest reason, which is regulatory and statutory. We now own 9.8% of the bank. If we go above 10%, all kinds of new rules kick in — whether it be by our regulator or the European regulator or the Swiss regulator, we’re not inclined to get into a new regulatory regime.”
These comments were seen as a signal that the Saudi bank was to further sell off Credit Suisse’s shares, and it fanned the flames of mistrust in the lender, which had already seen clients pull out more than $110 billion in the last three months of 2022.
Khudairy’s response and an already weakened share price are believed to have contributed to Credit Suisse losing a fifth of its value and led to a forced takeover a few days later by the Swiss bank’s domestic rival UBS. The latter agreed to the purchase for $3.2 billion in stock, while picking up $5.4 billion of its losses, reported Reuters.
After his comments on Credit Suisse helped spark a slump in the lender’s shares, Saudi National Bank Chairman Ammar Al Khudairy resigns https://t.co/9aaWunmcFT pic.twitter.com/RpqLCQwpMg— Bloomberg (@business) March 27, 2023
Khudairy became synonymous with the bet on Credit Suisse, and when that crumbled SNB suffered, losing about $1 billion as of last week. Although the loss wouldn’t cause a systemic issue for the bank, it was considered a blow to the Saudi lender’s credibility and leadership.
SNB acquired almost 9.9% of Credit Suisse for $1.46 billion last November, and the Saudi bank has lost more than $26 billion in market value since committing to the investment in October.
SNB had bet on Credit Suisse last year to bring it to the global stage and level up with the likes of Bank of America or the Bank of Singapore.