The cascade of scandal at Credit Suisse has forced its namesake country to rethink their responsibility-free attitude toward its bankers. That reconsideration, should it actually come to any kind of fruition, comes too late for any CSers to feel the fallout from the bank’s $5.5 billion in losses on the Archegos Capital Management collapse or the billions lost to investors in the Greensill Capital funds it backed, the same cannot be said of West Virginia’s former billionaire governor.
West Virginia Gov. Jim Justice is personally on the hook for nearly $700 million in loans his coal companies took out from now-defunct Greensill Capital….
Mr. Justice’s personal guarantee of the loans, which hasn’t been reported, puts financial pressure on the popular Republican governor….
The Swiss bank froze the investment funds in March and is in talks with Mr. Justice’s Bluestone Resources Inc. and other borrowers to recoup money to make investors whole, according to the people familiar with the discussions. Credit Suisse is under pressure to recover money quickly and has named Bluestone as one of three large borrowers from the Greensill funds that it has identified in its recovery efforts…. The guarantees were provided by Mr. Justice as well as his wife and covered unlimited amounts, some of the people familiar with the loans said….
Forbes this year dropped Mr. Justice from its billionaires list, owing to Greensill’s failure. It now pegs his net worth at $450 million, down from $1.2 billion in April 2020.
We’re sure the Trumpian governor will blame cancel culture and/or the liberal media and/or shadowy international financiers for his travails. But since he definitely won’t be blaming himself, here’s someone who actually is at least indirectly responsible for Justice’s woes.
In late 2014, David Solo lent A$12.2m to a little-known supply-chain finance group with eye-catching claims…. The cheque was helpful, but the real gold for founder Lex Greensill was Solo himself. Having recently left as chief executive of Swiss asset manager GAM, Solo became an adviser to the start-up….
“Without David’s introductions, Lex’s business would have died,” said a person who has worked with both men.
Anyway, speaking of Credit Suisse losing its increasingly angry horde of clients money….
The bank has seen redemption requests prompted by the poor performance of the CS Renaissance Alternative Access Fund, according to people with knowledge of the matter…. Redemption demands at the fund trigger a hold back clause, which means clients will receive 95% of their funds after two months, with the remaining 5% expected to be paid out in January, after the fund’s year-end audit, the people said….
The fund lost about 32% last year, in line with the decline in the Renaissance Institutional Diversified Alpha Fund International fund that it invests into….
West Virginia Gov. Jim Justice Is Personally Liable for $700 Million in Greensill Loans [WSJ]
How Swiss asset managers opened their doors to Lex Greensill [FT]
Credit Suisse’s RenTech Fund Holds Back Some Client Cash [Bloomberg]
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