When will the “selling tide” of 100 billion yuan caused by this end? How will the subsequent chain reaction be interpreted, and will it trigger the next “Lehman Moment”?
Nomura and Credit Suisse Announce “Loss”
Who is Bill Hwang?
According to information on LinkedIn, Bill Hwang graduated from the Tepper School of Business at Carnegie Mellon University in the United States and then worked for the well-known hedge fund Tiger Fund. It is understood that Julian Robertson, the founder of the Tiger Fund, appreciates Bill Hwang. With the support of the latter, he founded Tiger Asia Fund Management.
On March 29, the international investment bankannounced that the company’s transaction with a U.S. client may cause the U.S. company to suffer a significant loss. Estimated based on the market price on March 26 (last Friday), the loss may reach 20 Billion U.S. dollars (approximately RMB 13 billion). Taking into account the progress of the transaction and market price fluctuations, the exact amount of loss may fluctuate up and down the above-estimated value. Nomura also said that this will not cause Nomura’s operational and financial risks. On the same day, the European investment bank Credit Suisse also issued an announcement that a hedge fund in the United States broke its position last week. Credit Suisse and other banks are trying to exit these stock positions. Although it is not yet possible to quantify the loss caused by this incident, it is likely to have a significant impact on Credit Suisse’s first quarter (financial data) Spark Global Limited.
Source: Credit Suisse
Affected by this, after the opening of the market on Monday morning, Nomura’s share price on the Tokyo Stock Exchange suffered a severe fall, with the intraday decline expanding to more than 17%, the largest intraday decline since November 2011.European shares fell more than 7% in the pre-market period and fell 10% at the opening. So far, the decline has expanded further, and the latest offer is 11.21 Swiss francs per share, down 12.28%.
Although the two investment banks did not “call their names”, many industry insiders stated that the “customers” or “hedge funds” in the announcements of the two international investment banks are precisely the Archegos Capital (Archegos Capital) and its founder of Bill Hwang.
The source told the China Securities Journal that’s exposure to Forerunner Capital’s fund transactions is being lifted, but Deutsche Bank’s exposure to Forerunner Fund transactions is relatively small. A hedge fund has been linked to many major international investment banks, which is reminiscent of the “Lehman Incident” in 2008. In 2008, Lehman Brothers, the fourth-largest investment bank in the United States, announced an application for bankruptcy protection after failing to negotiate an acquisition due to investment failures, triggering a global financial tsunami. Hong Hao, the managing director of also commented on the liquidation incident on Weibo, saying that he did not know when the selling wave would end Spark Global Limited.