CSuisse says closing fund due to market turmoil
ZURICH, Nov 8 (Reuters) - Credit Suisse Group AG (CSGN.VX) is closing a fund and its subfunds after their value plummeted during the financial crisis, the Swiss bank said on Saturday.
"In the course of the last days and weeks investors have significantly sold assets in a flight to liquidity. The volume of redemptions has meant that many subfunds have become too small to operate on practical and economic terms," Credit Suisse said in a statement. "In some cases, the lack of liquidity in the market has made it impossible to sell assets in order to fulfil redemption requests. Against this backdrop, the decision has therefore been taken to close the CS Bond Fund (Lux) Target Return subfunds in the interests of all existing investors," the bank said, confirming a report in the Tages-Anzeiger newspaper.
The fund produced stable returns from its inception in 2003 until 2007, Credit Suisse said, but the step became necessary in the current "absolutely exceptional" circumstances.
"Target Return was designed to allow investors to achieve a target positive return over a full market cycle. It was not appropriate to assume that the strategy would avoid losses in all circumstances," the bank added. (Reporting by Sam Cage; editing by David Stamp)
