ZURICH (Reuters) - Credit Suisse (CSGN.S) will take another around $100 million (68.87 million pounds) writedown as part of the sale of assets in its distressed credit portfolio to U.S. investment firm TPG’s [TPG.UL] TSSP, with most of the charge reflected in the Swiss bank’s first-quarter results.
The charge comes after Credit Suisse in March announced that it would be taking $346 million in writedowns in the first quarter as of March 11.
TSSP is buying credit assets for about $1.27 billion, the companies said on Tuesday in a joint statement. Additional terms of the transaction were not disclosed.
The charge adds to the roughly $1 billion in writedowns that Credit Suisse Chief Executive Thiam Tidjane has announced over the past two quarters as he seeks to clean up problems at the bank since taking over last year.
The bank has previously said there were “no blind spots” in its portfolio that triggered the writedowns.
“The Credit Suisse Global Markets division has accelerated its strategic implementation of a business model that is better aligned to the overall group strategy, with lower risk appetite and reduced volatility,” Credit Suisse said on the sale of the assets to TSSP.
With the transaction a pair of Credit Suisse employees — U.S. credit trading head Bob Franz and the head of distressed research and trading Ken Hoffman — “will lead the formation of a new asset management firm to assist in servicing these assets and other similar assets in the future”, the statement said.
The bank’s latest $100 million writedown more than doubles charges from the distressed credit portfolio announced on March 23, when the bank also announced it was cutting another 2,000 jobs.
“The portfolio we are acquiring has deep, long-term potential and fits well with our patient and flexible capital,” said Clint Kollar, a partner at TSSP, which has approximately $19 billion in assets under management and was created in 2009 as TPG’s global credit and special situations platform.
Credit Suisse is due to announce first-quarter results on May 10, when it will give an update on its distressed credit exposure.
Reporting by John Miller; Editing by Michael Shields