The major Swiss bank does not make it out of the crisis.
(Photo: Bloomberg)
Zurich According to media reports, Credit Suisse is planning a large-scale restructuring of the board: As the “NZZ am Sonntag” writes, citing insiders, CFO David Mathers, chief legal officer Romeo Cerutti and Asia board member Helman Sitohang are to leave the bank. The Bloomberg news agency also reported that Cerutti would be replaced by Markus Diethelm, who held the same position at UBS until November 2021.
The bank only explained that in the implementation of the new strategy, which has already been announced, management and the board of directors are also dealing with the issue of succession planning and appointments for certain senior positions. “However, it is important to emphasize that the Board of Directors has not yet made a decision and we will communicate in due course.”
With Mathers and Cerutti, the longest-serving board members of Credit Suisse are now apparently affected. Cerutti has headed the bank’s legal department since 2009, and Mathers has been responsible for finance since 2010. Both managers had survived billions in losses and a multitude of scandals at Credit Suisse: from the admission of guilt in aiding tax evasion in the USA, to a Geneva-based private banker who betrayed rich customers from Eastern Europe, to bond fraud in Mozambique and a shadowing affair on Zurich’s Paradeplatz.
The bank’s two most recent crises, the liquidation of the Greensill supply chain fund and the collapse of the Archegos hedge fund, which cost the bank five billion dollars in capital, initially had no consequences for the veteran managers. But before the bank’s general meeting on Friday, the pressure on CEO Thomas Gottstein was apparently too great.
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Several voting rights advisors recommended that the shareholders refuse to approve the actions of the board of directors. Contrary to statements to the contrary, the bank did not want to publish the results of an internal investigation report on the Greensill scandal. Before the general meeting, the institute only published a question-and-answer catalogue, in which it acknowledged breaches of duty by bank employees.
Completely renewed top management
The top management has thus been largely renewed: apart from CEO Gottstein and Switzerland boss André Helfenstein, all other board positions since the collapse of Greensill in March 2021 have been filled with the latest personnel decisions. The bank has already made two changes at the top of the board of directors and has filled other supervisory positions.
Credit Suisse has been in the process of restructuring for years, but the series of failures and affairs have made the institution the number one problem child in the European banking industry. The bank had again announced a loss for the first quarter. The bank recently had to send out two profit warnings within three months – also because of expensive legal cases that date back a long time.
Especially since the acknowledgment for the most recent failures is still pending: Credit Suisse customers who have lost money with investments in the Greensill funds are only just getting into position. Within a few months, the US House of Representatives has twice requested bank chief Gottstein to provide information on the Archegos collapse and to implement US sanctions against Russia.
With the designated chief lawyer Diethelm, Credit Suisse could hire a manager who has a lot of experience in dealing with bank supervisors: in 2008 he negotiated a tax deal with the US authorities for UBS. Diethelm was also involved in the processing of billions in losses triggered by a stock trader in Great Britain. He helped UBS escape a billion-dollar fine from EU competition watchdogs in the Libor scandal and most recently ensured that a French court of appeal significantly reduced a fine against UBS for aiding and abetting tax evasion.
One of the most important tasks of the new legal director is to find a quick compromise with the Greensill investors. The bank can hardly afford another year-long legal dispute with its own customers.
More: Second profit warning in three months: Credit Suisse starts with a quarterly loss in 2022