Switzerland’s second-largest bank Credit Suisse Group (NYSE:CS) (GB:0QP5) has raised CHF2.24 billion through a rights offering to its investors. The American depository shares of Credit Suisse gained 4.7% in Thursday’s trading session.
The company said that about 98.3% of the offer was exercised by investors. Also, Credit Suisse informed investors that the remaining stocks will be sold in the market at or above 2.52 francs per share.
This brings the final part of its capital-raising plan to an end. Last month, the bank raised CHF1.8 billion through a private placement with some institutional investors, including the Saudi National Bank. Credit Suisse has raised about CHF4 billion, which is expected to fund its turnaround plan.
In the Q3 earnings call, Credit Suisse revealed plans to restructure its Investment Bank, cut down on costs, and strengthen its capital position. The announcement was much needed, as the company was surrounded by several lawsuits and financial concerns. The stock is down more than 66% so far this year.
Is Credit Suisse Stock a Buy, Sell, or Hold?
While Credit Suisse’s restructuring moves are encouraging, investors should take caution and wait for the company’s measures to gain traction. Credit Suisse stock has a Hold consensus rating on TipRanks based on two Buy, 10 Hold, and four Sell recommendations. The average price target of SFr.5.29 implies 79.8% upside potential from current levels.
