The troubled Swiss bank has placed a lot of hope in the Asian market. Now, of all places, additional unrest is coming from there.
(Photo: Reuters)
Bangkok The ailing Swiss bank Credit Suisse is struggling with increasing personnel problems in one of its most important growth markets. The bank has already seen a number of senior departures in its business with affluent customers in Asia.
On Wednesday, it announced its biggest loss to date: the deputy head of the Asian wealth management division, Young Jin Yee, is leaving the group, as the bank announced in a statement to employees.
The manager, who only took on the post earlier this year, wants to pursue career opportunities outside of Credit Suisse, it said. She also most recently headed the bank’s SymAsia Foundation, which pools philanthropic activities.
Young’s departure threatens to further intensify the uncertainty among employees and customers. She worked for the Swiss bank for almost two decades and was most recently based in the Southeast Asian financial metropolis of Singapore.
Top jobs of the day
Find the best jobs now and
be notified by email.
Group boss Ulrich Körner wants to present a new strategy for the troubled financial institution by the end of the month, which could lead to the loss of thousands of jobs. The planned cuts are apparently primarily aimed at investment banking, while the core business of wealth management is to be strengthened – particularly in Asia.
But the departures show that parts of the staff there also apparently see no future for themselves at the bank.
At least five executives and directors from Credit Suisse’s private banking business in Hong Kong have said goodbye in recent weeks, including Luke Chiu, a managing director in charge of the Chinese market, according to reports from Bloomberg.
Credit Suisse shares fell by almost 12 percent to a record low of CHF 3.50 on Monday due to speculation about the bank’s financial situation and increased premiums for credit default insurance, but were able to recover from the slide on Tuesday. On Wednesday evening, the share was listed on the Swiss stock exchange at 4.11 francs – and thus lost more than four percent compared to the previous day.
Customers seem to withdraw funds
The bank commented reassuringly on the departures in Asia. “Here in Asia Pacific, we are focused on making sure our clients get the guidance they need to weather the tough times in the markets,” the lender said.
The head of wealth management in Asia, Benjamin Cavalli, who lost his deputy with Young, said in response to media inquiries: “As our CEO said, we are in a healthy capital and liquidity position.”
Empire of the middle
12.2
Million dollar millionaires
are expected to live in China by 2026 – twice as many as today.
But trust is apparently dwindling among business partners: some of the bank’s wealth management customers have expressed concern about the future of the group, the Reuters news agency reported. Clients have therefore already withdrawn funds, it said. This development could pose additional challenges to trying to make asset management the core of the recovery.
Credit Suisse assumes that the continent will produce more new millionaires in the coming years than any other region in the world. In China alone, the number of dollar millionaires is expected to almost double by 2026 from around 6.2 million to 12.2 million, according to the bank’s “Global Wealth Report” published at the end of September.
In India, the bank also expects massive asset growth. There, too, she expects the number of millionaires to double from almost 800,000 to around 1.6 million.
The person responsible for Asia at Credit Suisse Cavalli was recently convinced that his bank could benefit from the trend. “2022 will be a transitional year for us as we lay the groundwork to achieve our key goals by 2024,” he said in an interview published in August. It is about gradually increasing the resources used in wealth management in order to accelerate growth.
Cavalli contradicted speculation about a departure from the China business. “Despite all the rumors that Credit Suisse is pulling out of China, China is a long-term target for us,” he told Reuters.
The bank plans to start offering wealth management services in mainland China next year. The full acquisition of the Chinese securities joint venture Credit Suisse Securities, which the group previously operated with a Chinese partner, is expected to be completed in early 2023.
More: Credit Suisse should accelerate its schedule