The chairman of the Saudi National Bank has resigned for “personal reasons” less than two weeks after his comments on Credit Suisse fuelled the lender’s share price crash that ultimately saw it acquired by rival company UBS.
The resignation of Ammar al-Khudairy at Saudi National Bank, the largest commercial bank in the oil-rich kingdom, comes just months after the lender invested an additional 1.5 billion dollars (£1.22 billion) in Credit Suisse to take its holding in the Swiss bank to nearly 10% of its value.
While Mr al-Khudairy sought to clarify his remarks made on March 15, they caused Credit Suisse shares to drop by around a third of their value at the time, which ultimately led to its rescue takeover.
The incident further spooked international markets already reeling from other bank collapses and high inflation brought on in part by Russia’s war on Ukraine.
The filing on Riyadh’s Tadawul stock exchange said Mr al-Khudairy would be replaced by Saeed al-Ghamdi, the bank’s chief executive.
It did not elaborate on Mr al-Khudairy’s departure, only citing “personal reasons”.
Saudi National Bank stock traded more than 12 dollars a share Monday. They had been as high as nearly 22 dollars a share over the last year.
Shares of Credit Suisse sank over 30% after Mr al-Khudairy told Bloomberg on March 15 that its biggest shareholder – the Saudi National Bank – would not provide more money to the Swiss lender.
“The answer is absolutely not, for many reasons outside the simplest reason, which is regulatory and statutory,” Mr al-Khudairy said at the time.
“We now own 9.8% of the bank. If we go above 10%, all kinds of new rules kick in, whether it be by our regulator, or the European regulator or the Swiss regulator.”
He added: “There is a glass ceiling and we do not intend entertaining of going beyond that.”
Hours later, Switzerland’s central bank agreed to lend Credit Suisse up to 54 billion dollars (£44.1 billion) to shore up its finances.
The next day, Mr al-Khudairy told CNBC: “It’s panic, a little bit of panic… I believe completely unwarranted, whether it be for Credit Suisse or for the entire market.” But the damage was already done.
On March 19, banking giant UBS said it would buy Credit Suisse for almost 3.25 billion dollars (£2.65 billion).
That is even as Credit Suisse had some 1.4 trillion dollars (£1.1 trillion) in assets under management at the end of last year.
Gulf Arab investors in Saudi Arabia and Qatar have been among some of those hardest hit by Credit Suisse’s collapse.
Oxford Economics said on Thursday: “The Saudi National Bank was a top stakeholder … and now faces over 25 billion dollars (£20.4 billion) of losses. The Saudi conglomerate Olayan Group also had a 3.27% stake in Credit Suisse.
“The Qatar Investment Authority had a 6.8% holding and was a major landlord for the bank’s London branch. However, we expect the turmoil to be contained to short-term financial market disruption with limited spill over.”