The Chairman of the Board of Directors explains the takeover of Credit Suisse at the Annual General Meeting.
(Photo: Bloomberg)
Zurich Axel Lehmann still can’t quite believe it. The Chairman of the Board of Directors of Credit Suisse had to admit his failure in front of 1,700 shareholders on Tuesday. “You can believe me: We fought with all our might for a successful turnaround,” said Lehmann, according to the speech transcript. “At the same time, we believed in the resilience, future viability and potential of the bank.”
Nothing helped: “The dynamics of emotions and the collapse of trust were stronger,” admitted Lehmann. “We hadn’t managed to balance the series of scandals that had accumulated in the past with positive facts and to restore the shattered trust.”
Finally, after a turbulent week in mid-March, not only Lehmann was clear: “The bank could no longer be saved.”
167 years after the bank was founded by the Swiss industrial magnate Alfred Escher, Credit Suisse shareholders are meeting for the last time this Tuesday for the Annual General Meeting, which is called the General Assembly in Switzerland. The frustration of the shareholders is great since the bank had to be rescued by an emergency takeover by UBS.
Previously, growing uncertainties in the financial sector, emanating from some bank difficulties in the United States, and apparently thoughtless statements by a major Saudi shareholder in Credit Suisse had triggered a share price crash and a customer exodus.
Credit Suisse boss: “False rumors and speculation”
The top management could not recognize their own mistakes in the collapse. Rather, the President of the Board of Directors Lehmann and CEO Ulrich Körner see the blame for their predecessors and external factors. “Contamination after contamination had previously shaken trust. And patience eroded with trust,” said Lehmann.
The specially drawn up plans for the necessary corporate restructuring could no longer be implemented. “It is a grim reality that the strategy has not had the time to work.”
CEO Körner made a similar statement: “What has happened in the last few weeks will concern me personally and many others for a long time to come.” Rapid progress has been made in the restructuring. But in October 2022, strong outflows of customer funds, triggered by false rumors and speculation, severely weakened the bank. “At the same time, for legal reasons, our hands were tied to comment on these false statements.”
Once the bank coped with a severe loss of confidence – but not a second time: After the bankruptcy of the Silicon Valley Bank had caused nervousness and the statement by the major Saudi shareholder that they no longer wanted to inject capital had pushed the share price down, the Customer flight unstoppable. “Unfortunately, we weren’t able to turn the wheel around this time.” He deeply regrets that personally, says Körner.
More: How it came to the deep fall of Credit Suisse