Banks grant Ebner loan relief

Ebner admitted mistakes in his company's business strategy Keystone

Swiss financier Martin Ebner has been given some breathing space on his debts so that he can stabilise his BZ Group, according to newspaper reports on Monday.

The Wall Street Journal quoted unnamed sources as saying that eight creditor banks – including Credit Suisse – had agreed to allow the Group to miss scheduled loan payments for about a year.

The payments would amount to around SFr3 billion, the sources said.

Both BZ Group and Credit Suisse declined to comment on the report.

According to the paper, the move is part of a package of measures to help steady the Group through its current liquidity crisis. The BZ Group – built up around the BZ bank – is reported to have amassed debts of around SFr10 billion ($6.8 billion) and last week had to sell control of four investment funds.

Other banks agreeing to the grace period were HSBC Holdings, Austria’s Raiffeisen Zentralbank, the Landesbank of Germany’s Baden-Wuerttemberg state as well as the Zurich Cantonal Bank and two Swiss regional banks, the paper said.

Mistakes made

In his first comments since the sale of the funds, Ebner said on Sunday he had been forced to act because of the stock market slump. But he also admitted flaws in his business strategy.

“The mistake we made was in having a portfolio that was not diversified enough,” Ebner told Swiss television on Sunday.

He declined to comment on reports of the BZ Group’s debts. But he denied that it was facing collapse following the sale of controlling stakes in Pharma Vision, BK Vision, Spezialitaten Vision and Stillhalter Vision to the Zurich Cantonal Bank.

“The BZ bank is absolutely solid,” Ebner said.

Although forced to sell the Vision funds, BZ Group still holds direct stakes in some of Switzerland’s biggest companies, including the ABB engineering group, Credit Suisse, the insurer Baloise and the chemicals firm Lonza.

The 56-year-old Ebner built up his BZ Group after leaving a career in investment banking. The multi-millionaire – who styled himself on the American investment tycoon, Warren Buffet – convinced thousands of Swiss to sink money in his investment accounts rather than invest in lacklustre savings accounts.

But his liquidity position was badly hurt recently when a flood of retail investors sought to bail out of the stock market, forcing BZ to fork out hundreds of millions of francs.

swissinfo