A Swiss flag flies over a Credit Suisse sign in Bern, Switzerland
FABRIC COFFRINI | AFP | Getty images
Credit Suisse announced several high-level staff on Tuesday and proposed a cut in the dividend as it weighs in on the heavy losses of the Archegos Capital saga.
“Particularly in response to the important issue of hedge funds in the US, the Board amends its proposal on the distribution of dividends and withdraws its proposals on the variable compensation of the Board of Directors,” the Swiss lender said in a trading update .
Investment bank CEO Brian Chin and Chief Risk and Compliance Officer Lara Warner will step down with immediate effect, the bank said.
Last week, Credit Suisse announced it was expecting heavy losses in the wake of the collapse of US hedge fund Archegos Capital. The bank was forced to dump a significant amount of stock to cut ties with the troubled family office, and now expects a first quarter loss of approximately 900 million Swiss francs ($ 960.4 million).
“This includes a charge of CHF 4.4 billion related to a US hedge fund’s failure to meet its margin commitments, as we announced on March 29, 2021,” added Credit Suisse.
The board of directors has also waived its bonuses for the fiscal year 2020, the bank announced, with Chairman Urs Rohner giving up his “seat fee” of 1.5 million Swiss francs.
At its AGM on April 30, Credit Suisse will now propose a dividend of 0.10 Swiss francs gross per share, along with the amended compensation report.
Last month, the bank announced a shake-up of its asset management business and a suspension of bonuses to limit the damage caused by the collapse of British finance company Greensill Capital.
The board of directors has launched two separate investigations, to be conducted by third parties, into the Greensill and Archegos sagas, pledging to “not only focus on the immediate problems arising from each of them, but also to reflect. about the broader implications and lessons learned. “
Chin will be replaced at the helm of the investment bank on May 1 by Christian Meissner, currently Credit Suisse’s co-head of international asset management, investment banking advisory and vice-chairman of investment banking.
Joachim Oechslin has been appointed interim chief risk officer and Thomas Grotzer as interim global head of compliance effective Tuesday. All three will report to CEO Thomas Gottstein.
“The significant loss in our Prime Services business related to the failure of a US-based hedge fund is unacceptable,” Gottstein said in a statement.
“Coupled with the recent issues surrounding supply chain funding funds, I recognize that these cases have been of great concern to all of our stakeholders. Together with the Board of Directors, we are fully committed to addressing these situations. lessons are learned. “
This is a story in development and will be updated shortly.