Bill Hwang, a Korean-born New York-based investor on Wall Street, who had lost $20 billion in just two days, had perplexed everyone in the month of March this year. According to a report by Bloomberg, the abrupt collapse of the founder and CEO of the capital market company, Archegos Capital Management, is one of the most thrilling failures in modern financial history. No individual has lost so much money so quickly. The financial services giant is accused of concealing material defects in its risk policies to allow high-risk clients to take on excessive leverage, including Greensill Capital and Archegos Capital Management. This has exposed Credit Suisse to billions of dollars in losses.
What happened to the company that lost $20 billion within days
In March 2021, Credit Suisse was required to close and liquidate several investment funds tied to the activities of Greensill Capital. The investors in the funds, which totalled assets of approximately $10 billion, lost over $3 billion. A few days later, the meltdown at Archegos, the family-run business of investor Bill Hwang, unfolded as some of his biggest wagers started to move against him - positions he built with significant amounts of money.
When Credit Suisse and other banks that had extended credit to Archegos saw Hwang’s bets turn south, they required the firm to put up more money to cover the decline. When it could not, they began to liquidate Hwang’s portfolio, with Credit Suisse sustaining billions of dollars in losses. Following these disclosures, the ADRs lost more than $20 billion in market value. In April 2021, at least seven top executives were removed from their posts after Credit Suisse reported losses of $4.7 billion linked to its prime brokerage services provided to Archegos Capital.
Where is Bill Hwang
Since the disastrous debacle that hit Bill Hwang and his company, everyone is figuring how did he endure such a tremendous loss and also try to find where he is. According to the reports, when the New York-based News met Hwang, he was relaxed and was found lying muffled in the tidy area of New Jersey. However, when asked about the recent development, he declined to discuss the Archegos disaster or his next steps.
(With inputs from AP)
(Image Credit: @HwangBill/Twitter)
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