Archegos Ripples Through Banks’ Lucrative Hedge Fund Units

Nomura, Credit Suisse tighten financing in hedge fund units
Regulators are looking into what risks banks are taking

WATCH: Credit Suisse slashed the amount of money set aside for employee bonuses and used the savings to limit the financial hit from the implosion of Archegos. Sonali Basak reports.(Source: Bloomberg)

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By Cathy Chan and Steven Arons

April 13, 2021 at 3:36 PM UTC

Updated on

April 14, 2021 at 6:05 AM UTC

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The collapse of Archegos Capital Management LP, an investment firm that few even on Wall Street had heard of until it imploded last month, is changing a lucrative, decades-old part of global banking.

Nomura Holdings Inc. and Credit Suisse Group AG, the two lenders hit hardest, have started to curb financing in the business with hedge funds and family offices. European regulators are looking at risks banks are taking when lending to such clients, while in the U.S., authorities started a preliminary probe into the debacle.