Arkigos prepares for capital insolvency, triggered by several recovery efforts by banks Lost 10bn they lost On her decorating bet in March.
According to two people familiar with the matter, the family office run by Bill Huang has hired restructuring advisers to assess the potential legal claims of the banks and plan to remove the possibility of conducting its activities.
Credit Suisse, Nomura, Morgan Stanley, UBS, MUFG and Mizuho – the six banks that acted primarily as brokers – lost more than 10 10 billion when US-listed companies such as ViacomCBS were forced to lay off their offices after the failure. To meet margin calls.
According to three people close to the process, most of them are preparing to give the firm a “claim letter” – a request for payment before raising a legal claim – they want to finish the Archegos positions first; Credit Suisse said last week that it had sold 97 percent of the securities concerned.
Investors are also investigating whether Huang’s family office provided incorrect information about the amount borrowed from other major brokers.
According to a person close to the matter, UBS is among the banks that are verifying whether doing business with Arbigos has been “fraudulently persuaded”.
Archegos, Credit Suisse, Numura, Morgan Stanley and UBS declined to comment.
Banks allowed Archegos to tie up high levels in reserves. When the firm defaulted on margin calls – instructions to add more collateral to its broker accounts – banks offloaded its big halls in nine firms on the basis of its clearances, resulting in the worst losses on Wall Street in more than a decade.
The incident led to a restructuring of the banks, which offered Archegos a profit of ৫০ 50 billion, and began an investigation into their risk control from regulators in the United States, the United Kingdom and Switzerland. Credit Suisse and Numura’s senior executives, who together lost 3 8.3bn, have been fired or fired.
U.S. lawmakers have asked banks to explain why they have extended such a large credit line to Huang, whose former hedge fund Tiger Asia Management was accused by U.S. and Hong Kong regulators of domestic business in 2012 and 2014.
A person close to the situation said: “There is a question mark over the extent to which the banks are entitled to claim and whether there is any supervision over the manner in which the banks acted on the funds at the time of disposal of these stocks. Any compensation that was in the down and exchange agreement will come down. ”
“They did all the lawyers and threatened to sue,” the person added. “Banks are going to demand as much as they can.”
Under the management of Meltdown in March. Since removing ারের 10 billion in assets, Archegos has hired restructuring and insolvency advisers, as well as lawyers and public relations consultants. U.S. law firms King & Spalding, Kellogg Hansen and Gibbons, as well as PR veteran Michael Satrick are advising Archegos and Hwangke.
Additional report by Eric Platt of New York