Credit Suisse scandals: What's going on at Switzerland's top bank?
As one of Switzerland’s oldest and most prestigious financial institutions, it may be surprising to see what is going on at Credit Suisse at the moment. The Swiss bank has been battered by scandal after scandal for the past two years, with job losses and cuts on the horizon. Here’s everything we know so far:
Trouble at Credit Suisse for the past few years
PR problems first arose for Credit Suisse when allegations of racism were made against the company in October 2020. The events were triggered by an article in the New York Times, which alleged that the French-Ivorian former Credit Suisse chief Tidjane Thiam experienced racism during his time at the company.
Thiam had himself been caught in the spotlight earlier in 2020 when he was ousted for his role in a spying scandal which saw former top executives followed and spied on by private investigators.
Trouble for the bank continued when prominent clients Greensill Capital and Archegos went bust in 2021, leaving yet another mess for Credit Suisse to clean up and billions of dollars in losses for the firm. According to Swissinfo, the loss of Greensill and Archegos led to the exit of several top executives, and the end of bonuses for the ones that remained.
Worst of all, these are just a few of the scandals that have hit the bank in the past two years - another being chairman Antonio Horta-Osorio’s resignation after being caught breaking COVID-19 rules to take a private jet to the Wimbledon tennis final. Then there was the leaking of financial data belonging to Credit Suisse clients in the 2022 “Suisse Secrets” leak, which revealed alleged financial ties with bad actors.
More scandals yet to come for Credit Suisse
Unfortunately, it seems the crisis is far from over for the Swiss bank. According to a report in The Guardian, between 2012 and 2016, Credit Suisse arranged a number of loans in Mozambique, meant to be invested in a maritime security project and a state tuna fishery.
According to the newspaper, the loans have led to a corruption scandal, after it was alleged that contractors had taken 171 million Swiss francs for themselves, with 50 million Swiss francs ending up in the hands of Credit Suisse bankers.
While the firm paid the 400 million Swiss franc fine imposed for "Tunagate", the company still has a trial pending for the alleged offences in 2023. Financial authorities in the US, UK and Switzerland blame the company’s antics in Mozambique for the country’s ongoing debt crisis and financial instability.
Job losses and asset sales on the cards at Credit Suisse
Inevitably, all this drama has had serious consequences for Credit Suisse’s finances. In recent months the firm has been selling off assets, including the luxurious Savoy Hotel Baur en Ville in Zurich for 400 million Swiss francs. Credit Suisse has been selling its stakes in other companies too, having sold a 328 million stake in the Spanish fintech company Allfunds.
Credit Suisse has also announced job cuts. The company said that it aims to slim down its workforce from 52.000 to 43.000 before the end of 2025, starting with 2.700 jobs that will be gone by the end of 2022. The company is also searching for new investors, with the Saudi National Bank having already announced its purchase of a 1,5 billion Swiss franc stake in the company.
Alongside the cash injection, Credit Suisse has hired top experts to make the tough decisions needed to help stabilise the firm. According to The Daily Telegraph, the company has just taken on Ulrich “Uli the knife” Koerner - known for his brutal cost-cutting methods - which will hopefully improve the firm’s finances.