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UPDATE 3-Activist RBR courts fellow investors for Credit Suisse break-up

* Swiss fund RBR launches campaign to break up Credit Suisse

* RBR has small stake, faces challenge to gather support

* Activist goes public after meetings with Credit Suisse (Adds investor comment, updates share price, details on meetings)

ZURICH, Oct 17 (Reuters) - Activist investor RBR Capital Advisors sought on Tuesday to rally support for a campaign to break up Credit Suisse, hoping to capitalise on unrest after Switzerland's second-biggest bank lost about a quarter of its value since 2015.

However, the Swiss hedge fund led by Rudolf Bohli, 48, has taken a stake of only around 0.2 percent in Credit Suisse and faces a steep challenge to muster the backing needed to succeed.

"This is like an ant trying to tackle an elephant," said Marc Halperin, fund manager at Federated Investors, a top-25 Credit Suisse shareholder according to Thomson Reuters data.

The campaign comes roughly two years into Credit Suisse Chief Executive Tidjane Thiam's three-year plan to focus on wealth management and rely less on investment banking.

RBR, which has been in contact with Credit Suisse's management, wants to divide the company into an investment bank, an asset management group and a wealth manager accommodating the Zurich-based bank's retail and corporate banking operations, an RBR spokesman said.

The strategy, which will be outlined at the JP Morgan Robin Hood Investor Conference in New York on Friday, could see the revival of the old First Boston brand, the name of the U.S. investment bank Credit Suisse took control of in 1988.

TESTING PATIENCE

Thiam's restructure suffered an early blow when $1 billion in trading losses prompted him to make even deeper cuts to the investment bank in early 2016.

With the value of the stock diluted by two capital raisings totalling around 10 billion Swiss francs ($10.2 billion), shareholders are still awaiting the fruits of the painful overhaul.

Although shares had gained almost 10 percent this year, the performance reflected only a partial rebound from a feeble 2016 where they fell nearly a third.

Federated Investors' Halperin said Credit Suisse management had done a "pretty good job". While he was prepared to be patient with them, he could support RBR if they had a better plan to bolster the share price, which remained cheap.

"We certainly think this thing is worth 70-100 percent more than where it is trading at," he said. "I would say at least the mid-20s is probably fair value."

At 1440 GMT Credit Suisse shares traded 1.5 percent higher at 15.69 francs.

BOUTIQUE HEDGE FUND

RBR, partly named after Bohli, was set up in 2003 as a boutique Swiss hedge fund and has around 250 million francs in assets under management.

Based in the small lakeside town of Kuensnacht, near Zurich, it rose to prominence through high-profile but ultimately unsuccessful activist campaigns against asset manager GAM last year and airline catering company Gategroup in 2016.

Although RBR's stake is relatively small - it has spent around 100 million francs to build up its stake compared to Credit Suisse's market capitalization of 39.6 billion francs - it said it has signed non-disclosure agreements with around 100 other investors, including some shareholders in Credit Suisse.

RBR has also recruited Gael de Boissard, a former Credit Suisse investment bank co-head who left the bank in Thiam's restructure, to support its campaign, news of which was first reported by the Financial Times.

Credit Suisse on Tuesday said it remained focused on its strategy.

"While we welcome the views of all our shareholders, our focus is on the implementation of our strategy and of our three-year plan, which is well on track and which we believe will unlock considerable value for our clients and shareholders," a Credit Suisse spokesman said.

A source familiar with the investor meetings said Credit Suisse officials had met RBR several times about its suggestions and that the fund had alerted the bank on Friday that it would go public with its campaign.

SHRINKING INVESTMENT BANK

RBR's is the second activist investor campaign involving a big Swiss bank in recent years after Knight Vinke unsuccessfully pushed for UBS to make more drastic cuts to its investment bank.

Credit Suisse has argued keeping an investment bank is vital to cater for the more sophisticated needs of wealth management clients whose assets stretch into the billions of dollars.

But while analysts doubted Bohli's break-up plan would gain the necessary traction with other investors, some suggested Credit Suisse could still pare back its investment bank even further.

"You have a comparative advantage in the market if you have a private banking and investment banking business," said Mirabaud Securities Limited analyst Andreas Brun, who rates Credit Suisse's stock "buy".

"But you could do it with a smaller investment banking unit than what Credit Suisse has." ($1 = 0.9771 Swiss francs)

(Additional reporting by Simon Jessop in London and Rupert Pretterklieber in Zurich; Editing by Keith Weir)