Posted on Apr 30, 2021 8:58 AM
Heads continue to fall at Credit Suisse after the Greensill and Archegos scandals. Particularly targeted by shareholders who did not intend to renew him as head of the risk management department, Andreas Gottschling took the initiative by deciding to resign before the annual general meeting on Friday.
This is the first time that a member of the Credit Suisse supervisory board has been swept away by the wave of departures. Before him, the director of the investment bank Brian Chin, the risk director Lara Warner or the leaders of the “prime brockerage” division had resigned. The managing director, Thomas Gottstein, remains in place for the time being.
A desire to reassure on risk management
Several shareholder organizations had called for votes against Gottschling’s re-election as head of risk management. The consultancy firm Glass Lewis thus estimated that “the shareholders were entitled to attribute the responsibility [des scandales Archegos et Greensill] to the Board’s Risk Management Committee ”. She felt that a change in the management of this committee was necessary to regain the confidence of the shareholders.
At the end of March, the massive disposals of shares in the family office Archegos had led Credit Suisse to report a loss of 4.4 billion Swiss francs (4 billion euros), the biggest loss for a bank following this debacle. To this is added € 3 billion that Credit Suisse clients could lose due to the suspension of the Greensill-related supply chain finance funds that Credit Suisse was offering to its clients.
These two hard knocks for the finances of Credit Suisse, which forecast a pre-tax loss of around 900 million Swiss francs (818 million euros) after the Archegos accident, have discredited the capacity of the bank to manage risk. This was reflected in particular by the deterioration of the institution’s credit outlook from stable to negative by the rating agency S&P.