Credit Suisse First Boston
Credit Suisse First Boston (also known as CSFB and CS First Boston) is the investment banking affiliate of Credit Suisse headquartered in New York.[2]
This article is about the investment banking, capital markets and financial services division of Credit Suisse. For the parent company, see Credit Suisse.Industry
1988, 2022
2006: Merged into the reorganized investment banking division of Credit Suisse.
2022: Brand revived[1]
New York City, United States
The company was created by the merger of First Boston Corporation and Credit Suisse Group in 1988 and is active in investment banking, capital markets and financial services. In 2006, Credit Suisse reorganized and merged CS First Boston into the parent company and retired use of the "First Boston" brand. In 2022 as part of a major restructuring, Credit Suisse began the process of spinning out the investment bank into an independent company and revived the brand.[3]
History[edit]
Credit Suisse / First Boston 50 / 50 Joint Venture (1978–1988)[edit]
Main Article First Boston
In 1978, Credit Suisse and First Boston Corporation formed a London-based 50-50 investment banking joint venture called Financière Crédit Suisse-First Boston.[4] This joint venture later became the operating name of Credit Suisse's investment banking operations.
Transition to CS First Boston (1988–1996)[edit]
Credit Suisse acquired a 44.5 percent stake in First Boston in 1988.[5] The investment bank acquired its shares held by the public and the company was taken private. In 1989, the junk bond market collapsed, leaving First Boston unable to redeem hundreds of millions it had lent for the leveraged buyout of Ohio Mattress Company, maker of Sealy mattresses, a deal that became known as "the burning bed".[6] Credit Suisse bailed them out and acquired a controlling stake in 1990. Although such an arrangement was arguably illegal under the Glass–Steagall Act, the Federal Reserve U.S. bank regulator concluded that the integrity of the financial markets was better served by avoiding the bankruptcy of a significant investment bank like First Boston, even though it meant a de facto merger of a commercial bank with an investment bank.[7]