Statements by the Chairman of the Board of Directors of Credit Suisse are now being presumably checked.
(Photo: Reuters)
Zurich The statements by Credit Suisse Chairman of the Board of Directors Axel Lehmann on the outflow of customer funds have an aftermath. The Swiss financial market supervisory authority Finma contacted the major bank about the matter, as two people familiar with the matter told the Reuters news agency. Finma wanted to clarify what Lehmann’s knowledge was when he said in early December that the outflow of assets under management had come to a standstill. After that, however, billions were withdrawn from the crisis-ridden institute.
Credit Suisse said it does not comment on speculation. Finma also declined to comment. After the annual figures were published, the authority said: “It is clear that Finma monitors the banks very closely in such situations.”
Uncertainty about the state of the bank triggered a veritable flight of customers in the fourth quarter. From October to December, they withdrew CHF 110.5 billion from the second largest Swiss bank, as Credit Suisse announced when it published its annual results in February. Around 65 percent of this was in October and 20 percent in November, the management specified. This leaves around 15 percent of the outflows for December.
These were significantly stronger than investors had expected and were one reason why the share fell by around 15 percent on the day the financial statements were published. Andreas Thomae, corporate governance specialist at the fund company Deka Investment, said a day later that investors were disappointed that the outflows had continued, contrary to statements made by company representatives.
In an interview with the “Financial Times” on December 1, Lehmann explained that after strong outflows in October, these had “flattened completely and in some cases reversed”. The day after, he told Bloomberg Television the outflows had “essentially stopped.” Following these statements, Credit Suisse shares, which had fallen for twelve straight sessions, rose sharply and ended the day up around nine percent. A few days later, Lehmann reiterated that outflows had stabilized.
Finma now wants to find out whether Lehmann’s statements were misleading, one of the insiders explained. It was not a formal investigation, but a request from the authority to clarify what Lehmann and other top officials at the bank knew at the time. There are indications that Lehmann was not properly informed internally before he made these statements.
Credit Suisse under construction
The development of new money is a key figure for the assessment of asset management banks. If customers withdraw money on a large scale, this is often an expression of distrust. Very high outflows can bring an institute into liquidity bottlenecks.
The outflows came at a tricky moment for Credit Suisse. After a chain of failures and scandals, the bank under Lehmann and CEO Ulrich Körner, who has been in office since the summer, is in the process of fundamentally restructuring the institute. The core of the undertaking is the dismantling of risky investment banking and the expansion of business with millionaires and billionaires. The drains are a setback to this venture.
The assets under management of the group amounted to around 1.3 trillion francs at the end of 2022. Credit Suisse is falling further and further behind UBS, which is the world market leader in business with the rich and super-rich.
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