The chairman of Credit Suisse Group AG yesterday apologized to shareholders for failures of the once-venerable bank, and acknowledged the shock and anger felt as the troubled Swiss lender is set to be swallowed up by rival UBS Group AG in a government-arranged takeover.
Axel Lehmann, who took the top board job only last year after joining Credit Suisse from UBS in 2021, decried the “massive outflows” of customer funds in October last year and a “downward spiral” that culminated last month as turmoil from a US banking crisis spilled overseas.
“The bank could not be saved,” he said, and only two options awaited — a deal or bankruptcy.
Photo: AFP
“The bitterness, anger and shock of those who are disappointed, overwhelmed and affected by the developments of the past few weeks is palpable,” Lehmann told what is likely the last Credit Suisse shareholder meeting in its 167-year history.
“I apologize that we were no longer able to stem the loss of trust that had accumulated over the years and for disappointing you,” he said.
The bank’s pending demise has been years in the making, with critics blaming a blend of greedy managers, either unsuspecting or toothless regulators, government officials asleep at the wheel, and international pressure for profits and financial market stability at the expense of Switzerland’s generally staid and conservative culture. At times at Tuesday's shareholder meeting, US finance and allegations of American bullying were a target.
Protesters, including some hoisting a boat labeled “Crisis Suisse,” gathered outside a Zurich hockey arena hosting the meeting, and some shareholders voiced their anger as they got their last crack at managers following a collapse of the bank’s stock price over the past decade and an impending merger engineered to sidestep investor approval.
In 2007, Credit Suisse shares fetched as much nearly 88 Swiss francs. Today, they are trading at about SF0.80.
As the stock skid worsened and jittery depositors pulled their money, Swiss government officials hastily orchestrated a US$3.25 billion takeover by UBS two weekends ago.
Political leaders, financial regulators and the central bank feared that a teetering Credit Suisse could further roil global financial markets following the collapse of two US banks.
Some shareholders, who did not receive a vote on the takeover after the government passed an emergency ordinance to bypass the step, came to hear managers explain what went wrong.
“The whole thing — how this happened — makes me a little bit angry,” said shareholder Markus Huber, 56, as he lined up to attend his first Credit Suisse annual meeting.
Huber, who is self-employed in handyman services, suspected that government officials and bank leaders cooked up the deal “in secrecy” and said there should have been greater transparency.
Shareholders felt “a little bit astonished that there hadn’t been warnings out before,” he said.
However, the takeover was not on the docket for the annual general meeting, the first held in person in four years because of the COVID-19 pandemic.
The pared-down agenda included discussion on issues like a dividend of about SF0.05 per share, the re-election of the board under Lehmann and granting a form of approval to managers for most of their actions running the bank.
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