Credit Suisse says the Saudi National Bank is just one investor among others. Swiss Lawyer and compliance expert Monika Roth told NZZ why she sees this differently.

Since Credit Suisse announced the Saudi National Bank, majority-owned by the kingdom’s Public Investment Fund, agreed to take a significant 9.9 percent stake in the ailing lender by committing $1.5 billion, the media has been looking into what the Saudis are getting out of the deal and what this means for Switzerland’s second-largest bank.

Its investment wasn’t made purely for financial reasons, but could be a means for Saudi Arabia to achieve socio-economic approval in Europe, compliance expert Monika Roth, told the «NZZ» (behind paywall, in German) in an interview. This also fits the narrative that the kingdom is trying to establish itself as an international financial center.

The Saudi Arabian investors claim they do not want to sit on the board of directors, however, seeing as the governing board appoints and removes board members. If the Saudis were to change their minds in the future, this could have a significant impact on the bank’s future strategy, Roth said.

Suspected Murder

Then there’s Crown Prince Mohammed bin Salman’s, aka MBS, link to the murder of journalist and critic of Saudi Arabia's government Jamal Khashoggi, which Roth said made Credit Suisse’s business alliance with the country seem opportunistic.

Conceding that the bank most likely had no choice but to accept this offer, Roth said that in doing so Credit Suisse’s actions are at odds with statements CEO Ulrich Koerner recently made regarding the bank’s ethical principles.

Vision 2030

Another factor is the Saudi royal family’s Vision 2030 project, which involves building the kingdom into an international hub for the financial industry. The country’s banking system and financial infrastructure are fundamental for its Vision 2030 to work, «Bloomberg» writes, adding the country's many wealthy individuals rely on foreign wealth managers and banks where their institutions are lacking.

Middle East

SNB’s stake in Credit Suisse could play a role in the Saudi bank's attempts at getting that wealth to stay in the country, the report says. Moreover, the United Arab Emirates,  with Dubai and Abu Dhabi, is growing in importance as a financial hub as it diversifies its economy to be less dependent on oil.