Credit Suisse Group AG unloaded about $2 billion of stocks tied to the Archegos Capital Management blowup, according to people familiar with the matter.
The stock offerings — which included Discovery Inc. and Iqiyi Inc. — follow a torrent of similar transactions that had already erased about $194 billion in market value as banks from New York to Zurich and Tokyo unwound leveraged equity bets by Bill Hwang’s fund.
His private investment firm became the center of one of the biggest margin calls of all time late last month, and represented one of the most spectacular failures of risk-management and oversight in recent memory. The downfall of Archegos will result in $10 billion of losses to banks, according to analysts at JPMorgan Chase & Co. The debacle could attract regulatory scrutiny and potential fines for the banks involved, the analysts said this week.
Read more: Archegos Ripples Through Banks’ Lucrative Hedge Fund Business
A representative for Credit Suisse declined to comment. Discovery, Iqiyi and Credit Suisse all dropped in U.S. postmarket trading.
Tuesday’s block trades — which sold at the lower end of ranges — included 19 million Class A shares of Discovery sold at $38.40, said one of the people, asking not to be identified discussing a private matter. In addition, 22 million Class C shares of Discovery sold at $32.35 while a stake of 35 million Iqiyi shares went for $15.85.
Credit Suisse last week sold $2.3 billion worth of shares also tied to the debacle. The lender is also planning a sweeping overhaul of its hedge fund business following the Archegos’ implosion, which caused a $4.7 billion writedown at the bank.
