Saudi National Bank chair resigns after Credit Suisse meltdown

The boss of the Saudi National Bank abruptly resigned from his post Monday, just days after his critical comments about Credit Suisse sparked an industrywide panic that resulted in a forced rescue of the troubled lender by rival UBS.

Saudi National Bank Chairman Ammar Al Khudairy is stepping down “due to personal reasons,” a press release said without further elaboration.

He had led the bank since 2021.

Mohammed Al Ghamdi will replace Al Khudairy as chairman.

Al Khudairy’s resignation came less than two weeks after he rattled the market about Credit Suisse, whose troubles had reignited fears of a global banking meltdown.  

“The SNB Chairman was a victim of giving his honest opinion at such a tense time for Credit Suisse,” Mohammed Ali Yasin, a capital markets specialist and investment advisor, told Bloomberg.

The outgoing chairman had declared during a Bloomberg Television appearance that the Saudi National Bank, Credit Suisse’s biggest shareholder, would not consider pouring more money into the Swiss banking giant.

“The answer is absolutely not, for many reasons outside the simplest reason, which is regulatory and statutory,” Al Khudairy said in the March 15 interview.

Al Khudairy later attempted to do damage control, telling CNBC that the panic over Credit Suisse’s potential failure was “completely unwarranted.”

Nevertheless, Credit Suisse shares plunged to record lows following Al Khudairy’s remarks.

The bank had faced a crisis of confidence among investors after top executives admitted to “material weaknesses” in its financial reporting practices over the last two years.

“In hindsight, seeing the buyout rate of CS by UBS, his answer was the right course of action: awaiting for the crisis to be clearer.”

The Saudi National Bank is the largest commercial bank in Saudi Arabia. It formed after a merger of National Commercial Bank and Samba Financial Group.

The Credit Suisse crisis culminated in a government-brokered emergency rescue in which its Swiss banking rival UBS agreed to a $3.3 billion takeover.

The deal helped to assuage concerns among investors about the overall health of the global banking system, though it was expected to result in tens of thousands of layoffs.

Credit Suisse is one of several banks under close scrutiny after the collapses of Silicon Valley Bank and Signature Bank of New York prompted concerns about a global contagion event.

Shares of Deutsche Bank rebounded on Monday after fears eased that it would be the next bank in need of a rescue.