Credit Suisse files long-awaited US$440 million Softbank suit
CREDIT Suisse Group formally filed its long-awaited US$440 million lawsuit against SoftBank Group stemming from the spectacular collapse of finance firm Greensill Capital.
The Swiss lender sued Softbank in London earlier this month, saying it intended to continue to focus on “maximising recovery” for investors in its supply chain finance funds. The filing comes almost a year and a half after Credit Suisse first sought documents from the company.
For Credit Suisse, the high-profile collapse of disgraced financier Lex Greensill’s supply chain business was one of several major scandals that knocked confidence in the lender and ultimately led to the takeover by Swiss rival UBS Group.
Just days before the Swiss government orchestrated the UBS takeover, regulators said Credit Suisse “seriously breached” its risk management requirements.
The implosion of Greensill Capital in March 2021 saw Credit Suisse freeze and wind down a US$10 billion group of funds that the Swiss bank had marketed to clients as safe investments. The bank said that about US$6.8 billion of the funds have since been returned to investors.
The London suit is set to consider the way that Greensill restructured its relationship with Katerra, a US-based construction company in which SoftBank was a major investor. Credit Suisse alleges SoftBank concocted the restructuring so that it could pull its own money out, knowing full well that Greensill, already in free-fall, would be unable to repay the US$440 million it owed to Credit Suisse.
Softbank said it would “vigorously” defend the claim.
“After more than two years of attempting to shift blame for its own poor investment decisions, Credit Suisse has finally brought a claim but, as expected, it is entirely without merit,” a Softbank spokesperson said in a statement.
The two have engaged in a series of shadow legal skirmishes in the US and UK ahead of the filing of the claim. BLOOMBERG
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