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The major Swiss bank has had a rough 2021 so far. The bank’s reputation as the foremost of the major banks from the alpine country is at stake due to two scandals, which also contributed to it losing over $ 800 million in the first quarter of this year.
- The bank is heavily involved in the pull after the bankrupt financial company Greensill Capital, which collapsed earlier this year and had to withhold an investment of more than ten billion dollars in Greensill.
- It also ended up in the corner of shame when it became known that it had the largest exposure of all the financial institutions that had facilitated hedge fund manager Bill Hwang’s Archegos Capital huge bets on individual shares, which ended with the fund going over at Easter. Credit Suisse lost a total of $ 5.5 billion on the case of Archegos.
On Thursday next week, the bank’s new top manager António Horta-Osório will present second quarter figures. But before that, the bank confirms that it has put an end to a scandal that has hung over it in recent years, writes Financial Times, which refers to the Swiss newspaper NZZ am Sonntag.
Cocktail quarrel and noise behind the National Bank
It all started after the relationship between star broker Iqbal Khan and the bank’s top manager Tidjane Thiam soured. The two were neighbors in the exclusive area called the “Gold Coast” on Lake Zurich, but at a cocktail party they are said to have gotten into an argument after Thiam complained about the neighbor’s construction project, according to The Times.
Then Khan had been promoted several times by Thiam, but in July 2019, the relationship was at the freezing point according to FT. Then Khan resigned his position, to go to the competitor UBS.
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The Credit Suisse management then feared that Khan would take more from the credit house of Credit Suisse over to the rival. On the orders of Thiam’s deputy commander, surveillance of Khan and those he met must therefore have been initiated, through a private investigation company. One day, when Khan and his wife were in the center of Zurich, Khan must have noticed that someone was following him.
Khan himself has believed that these followed him both by car and on foot, but it all ended with a confrontation behind the Swiss National Bank in the city.
Had to go
When the scandal became known in the media, the pressure on top manager Thiam increased, although he himself should not have been directly involved in the decision to follow Khan. In February 2020, he finished as the bank’s top manager after five years.
Credit Suisse now confirms that a settlement has been reached in the case, to the Financial Times.
However, the matter is not completely out of the world: The Swiss supervisory body Finma is still investigating the major bank’s role in monitoring Khan and whether this violated any laws.
Khan received over eight million dollars in a one-time payment to sign for UBS, and has since experienced strong growth for the brokerage house of UBS, which last week announced that it had delivered a record quarter, writes FT.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We want you to share our cases using a link, which leads directly to our pages. Copying or other use of all or part of the content may only take place with written permission or as permitted by law. For additional terms look here.
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