Credit Suisse has closed bulk of exposure to Archegos - source

FILE PHOTO: The logo of Swiss bank Credit Suisse is seen at a branch office in Basel, Switzerland March 2, 2020. REUTERS/Arnd Wiegmann/File Photo

ZURICH (Reuters) - Credit Suisse has substantially reduced the vast bulk of its exposure to Archegos, a source familiar with the matter said, adding some residual risk remained despite its positions having been substantially eliminated.

Switzerland’s second-largest lender on Tuesday announced an estimated loss of 4.4 bln Swiss francs ($4.69 bln) from its relationship with Archegos Capital Management LP after offloading over $2 billion worth of stock to end exposure to the troubled investor.

The scandal-hit bank now expects to post a loss for the first quarter of around 900 million Swiss francs.

The Archegos fallout is the second major scandal for Credit Suisse in just over a month after the collapse of Greensill Capital, which led to the closure of its $10 billion supply chain funds which invested in bonds issued by Greensill.

That matter had not resulted in a material loss for the bank in the first quarter, the source said, as the bank does not hold trading exposure to Greensill.

Reporting by Brenna Hughes Neghaiwi and Oliver Hirt; Editing by Rachel Armstrong