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Credit Suisse overhauls executive board as it estimates Archegos fallout at $4.7 billion

Stock MarketsApr 06, 2021 06:35
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© Reuters. FILE PHOTO: Logo of Swiss bank Credit Suisse is seen in Zurich

By Brenna Hughes Neghaiwi

ZURICH (Reuters) - Credit Suisse (SIX:CSGN) on Tuesday said it was replacing senior managers, halting its share buyback programme and slashing its 2020 dividend as it grapples with the estimated 4.4 billion Swiss franc ($4.69 billion) fallout from its relationship with Archegos Capital Management LP.

Chief Risk Officer Lara Warner and investment banking head Brian Chin will both leave the bank in April, Switzerland's second largest lender said.

The bank said it now expects to post a pre-tax loss of roughly 900 million francs for the first quarter, as its strong performance in the quarter was wiped out by the affair.

"The significant loss in our Prime Services business relating to the failure of a US-based hedge fund is unacceptable," Chief Executive Thomas Gottstein said in a statement. "Serious lessons will be learned."

The bank will now propose a dividend of 0.10 francs per share, down from its earlier plan for a pay-out of 0.2926 francs.

It scrapped proposals for executive bonuses for the year and outgoing Chairman Urs Rohner's 1.5 million franc fee for the 2020-2021 period.

Warner will be replaced with immediate effect by Joachim Oechslin as interim Chief Risk Officer and Thomas Grotzer as interim Global Head of Compliance, the bank said. Christian Meissner will become CEO of the Investment Bank when Chin steps down from his role on April 30.

The changes mark the second and third changes to its executive board in the past month, after the bank in March overhauled its asset management business following a separate costly collapse of supply chain firm Greensill Capital.

($1 = 0.9372 Swiss francs)

Credit Suisse overhauls executive board as it estimates Archegos fallout at $4.7 billion
 

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Comments (6)
Takiyaki Kotaro
Takiyaki Kotaro Apr 06, 2021 9:57
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stonks
Chris Hm
Chris Hm Apr 06, 2021 9:09
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"Serious lessons will be learned."......so what were you doing before then ?...and did this really need to cost the bank billions ?
Michael Song
Michael Song Apr 06, 2021 8:46
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sorry but 4 billion lost and two managers fired only:))) I would suggest swiss government to temporarily (maybe turns out to be permanently) control the bank wiping out all top management and -1 managers...it isn't two people the entire board and their satellites were obviously sleeping:))
José Carlos Amaral
José Carlos Amaral Apr 06, 2021 8:35
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Memes stonks are laughing eheheh see you at the moon
Gunther Rohde
Gunther Rohde Apr 06, 2021 8:09
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Funny how lex greensill pulled all his money out of greensill just before it collapsed... corruption right at the top of thebfood chain... its all a big load of bullshit ,,, credit and debt mentality must be done away with ...its a lack mentality model, its not an abundance mentality ... the world and property is paid for why keep on paying for that what is already built ...
Kakololo David
Kakololo David Apr 06, 2021 7:45
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Woow let us go go go
 
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