The governor of the National Bank of Saudi Arabia, Credit Suisse’s largest shareholder prior to its takeover earlier this month, has resigned, the SNB said in a press release published on the Riyadh Stock Exchange on Monday.
The board of the Saudi National Bank “accepts the resignation” of Ammar al-Khudairy “for personal reasons,” the statement said.
On March 15, comments by Mr Khudairy claiming that the Saudi National Bank (SNB) would not increase its 9.8% stake in Credit Suisse for regulatory reasons had caused the Swiss bank’s share price to plummet.
The stock rose again the next day after the Swiss central bank announced $54 billion in aid, but that wasn’t enough to reassure investors amid general concerns about the financial sector.
On March 19, Credit Suisse was bought by UBS, the leading Swiss banking group, for a pittance.
The Wall Street Journal reported last week that the SNB’s $1.5 billion investment in Credit Suisse was made at the behest of the kingdom’s crown prince and de facto ruler, Mohammed bin Salman.
According to the daily, some Saudi sovereign wealth fund officials considered the operation “too risky (…) raising legal issues and the possibility of significant future losses.”
On March 16, Ammar al-Khudairy said in an interview with CNBC: “It’s panic (…), it’s completely unjustified, whether for Credit Suisse or for the ‘entire market’.
“Multiple failures”
In an interview with AFP on the same day, Saudi Finance Minister Mohammed al-Jadaan also said the market reaction was “perhaps a little overdone”.
Without specifically citing financial institutions, the Saudi minister had estimated that “multiple failures,” particularly in “oversight, management, concentration or mismatch between assets and liabilities,” had fueled the banking sector’s woes.
But these mistakes do not affect the kingdom, he added.
Mr Khudairy was replaced as chairman of the SNB’s board of directors by Saeed Mohammed al-Ghamdi, who previously served as the group’s executive director.
As his successor, Talal Ahmed al-Khereiji was appointed acting director.
On Sunday, Finma, Switzerland’s financial sector regulator, said it was studying ways to hold Credit Suisse executives accountable after the bank’s debacle.
“We are not a criminal authority, but we are examining appropriate options,” said its President Marlene Amstad in an interview with the Sunday newspaper NZZ am Sonntag.