Credit Suisse is planning to shut down CMBS division after announcing layoffs
Credit Suisse is planning to close down its commercial mortgage-backed securities division after it announced more layoffs several days ago, the Wall
Street Journal reported.
Albert Sohn, the Credit Suisse executive who oversees all securitized
products, informed the commercial real estate team Wednesday that they
would likely lose their jobs. While he said that a final decision
would be reached within the next 30 days, he told the team, based in the New
York headquarters, that they weren’t to make any new loans, spend firm
money, or travel to meet with clients. A Credit Suisse spokesperson
declined to comment officially.
New York State Comptroller Thomas DiNapoli earlier this week issued a
report saying that New York City’s securities industry could lose
nearly 10,000 jobs.
Credit Suisse had restarted its CMBS operation last year as the commercial property market was
showing gains. The team made loans estimated to be worth as
much as $1 billion, but hasn’t yet securitized any of that debt. While
earlier this year analysts were predicting that banks would securitize
$35 billion to $40 billion in commercial mortgages this year, more
than double last year’s volume, the market hit a downturn in the
summer as investors withdrew from riskier assets.
Earlier this week, MetLife announced it would be selling off its mortgage business. [WSJ] and [WSJ]