Credit Suisse Preparing Lawsuit Against SoftBank

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] Swiss bank Credit Suisse is reportedly preparing a lawsuit against SoftBank. This is due to SoftBank providing no explanation to Credit Suisse, the victim, regarding the bankruptcy of the UK-based Greensill Capital investment.

According to the Wall Street Journal (WSJ) on the 26th (local time), Credit Suisse filed a 'Section 1782 petition' with the U.S. Federal District Court in California on the 23rd. WSJ reported that through this, Credit Suisse is attempting to secure evidence related to the lawsuit against SoftBank's U.S. subsidiary.

The 'Section 1782 petition' is a regulation that allows parties preparing a lawsuit outside the United States to request the U.S. courts to collect evidence related to the lawsuit.

Previously, SoftBank had provided $440 million (approximately 500 billion KRW) in funding to Greensill in exchange for shares of Katerra, a U.S. construction startup in which SoftBank had invested. Credit Suisse claims that SoftBank gave no explanation to them, the actual victim, during the process of waiving rights to unpaid funds citing Katerra's management crisis.

Credit Suisse was a major investor in Greensill, which issued and sold securities backed by short-term corporate financing bonds provided to companies. However, in March, Greensill announced a suspension of trading for four funds that had invested in these securities.

Greensill, once valued at $4 billion, was a financial services company founded in the UK in 2011. It focused on supply chain finance and engaged in large-scale investment projects and banking operations but filed for bankruptcy protection in March.

Credit Suisse had long conducted business with SoftBank Group Chairman Masayoshi Son, but after Greensill's bankruptcy, it is known that transactions with both Chairman Son and SoftBank were significantly reduced.

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