Credit Suisse takes huge hit from hedge fund collapse

Hong Kong (CNN Business)The chairman of Credit Suisse has resigned following an investigation commissioned by the Swiss bank’s board that reportedly looked at claims that he broke Covid-19 rules.

António Horta-Osório said in a statement issued by Credit Suisse on Monday that “a number of my personal actions have led to difficulties for the bank and compromised my ability to represent the bank internally and externally.”
“I therefore believe that my resignation is in the interest of the bank and its stakeholders at this crucial time,” he added.

The statement did not reveal the nature of the investigation into Horta-Osório, who only joined the bank last April following a decade at the helm of British bank Lloyds (LLDTF).

But the Wall Street Journal said the inquiry focused on conduct including travel that breached Covid rules and his personal use of corporate aircraft.

Reuters reported in December that Horta-Osório had “attended the Wimbledon tennis finals in July during a visit to Britain when the country’s Covid-19 rules required him to be in quarantine,” citing two unidentified sources.

A spokesperson for Credit Suisse (CS) declined to comment when asked about the nature of the investigation.
Horta-Osório had been tasked with helping Credit Suisse recover from major losses sustained during the collapse of Archegos Capital and a corporate spying scandal.
According to an investigation published last summer, the firm’s investment bankers had allowed the US hedge fund to take “voracious” and “potentially catastrophic” risks that culminated in its spectacular downfall, costing the bank $5.5 billion.
Two senior Credit Suisse executives were forced out, including its top investment banker Brian Chin and chief risk officer Lara Warner.
In a statement at the time, Horta-Osório said that Credit Suisse had taken “a series of decisive actions” to strengthen risk oversight, and was “committed to developing a culture of personal responsibility and accountability.”
Credit Suisse has been trying to remake its image following two spying scandals in 2019 that led to the departures of several top executives, including former CEO Tidjane Thiam and former chief operating officer Pierre-Olivier Bouée.

Axel Lehmann, a former executive at Swiss bank UBS (UBS) who joined the Credit Suisse board last year, will succeed Horta-Osório as chairman.
Prior to UBS, Lehmann worked at Zurich Insurance Group. In a statement Monday, he said that “we have set the right course with the new strategy and will continue to embed a stronger risk culture across the firm.”

He also pledged to carry out the bank’s “strategic plan in a timely and disciplined manner, without distraction.”
— Hanna Ziady contributed to this report.
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