Credit Suisse Considering How to Reduce Ties to Greensill

(Bloomberg) -- Credit Suisse Group AG is looking at ways to reduce ties to Greensill Capital amid concerns about the size of its exposure to firms linked to U.K. industrialist Sanjeev Gupta.

Switzerland’s second largest bank is considering winding down $10 billion in investments packaged by Greensill, replacing the firm as the main source for the assets, or moving loans to firms linked to Gupta out of its supply-chain finance funds, according to people familiar with the options, who requested anonymity because a decision hasn’t been made yet.

The Wall Street Journal first reported on the plans on Sunday. Representatives for Credit Suisse and Greensill declined to comment.

During the summer, Credit Suisse started a review into the funds because of their large exposure to firms partially owned by SoftBank Vision Fund, Greensill’s main backer. The probe led to the bank overhauling the group of supply chain finance funds and it changed its investor guidelines to reduce the maximum exposure to a single borrower.

Read more: King of Supply-Chain Finance Expands, and Controversy Follows

Greensill’s German bank unit has also contacted investors in the past weeks as it looks to cut its exposure to companies linked to the U.K. industrialist. It’s unclear how much of the Credit Suisse supply-chain finance funds are currently tied up with Gupta.

Gupta’s GFG Alliance invests in and revamps moribund steel and power plants. Securities linked to Gupta and arranged by Greensill were among investments at the center of a 2018 crisis at Swiss asset manager GAM that brought down star trader Tim Haywood.

Read more: Greensill Bank Looks to Raise Cash, Cut Risk to Sanjeev Gupta

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