Finance

Credit Suisse shareholders should oppose risk chair at AGM, investor group says

One of the largest investor adviser groups wants Credit Suisse’s shareholders to oppose the election of its risk committee chair at the bank’s upcoming annual general meeting.

Glass Lewis claims the fallout from the bank’s exposure to the collapse of Greensill and Archegos Capital Management has “cast significant doubt” over the board’s ability to oversee the Swiss bank’s risk and control framework.

The group is recommending shareholders vote against the election of Andreas Gottschling at the bank’s AGM on 30 April. Gottschling has served as chair of Credit Suisse’s risk committee since 2018, and the proxy adviser claims he holds “ultimate accountability at board level”.

“While we find that the board has reacted quickly to the emergence of these events through a number of measures, including personnel changes in the investment bank and in the risk and compliance function, we nevertheless believe that shareholders would be warranted to also attribute accountability to the board’s risk committee,” Glass Lewis told shareholders.

Credit Suisse has implemented a series of high-profile personnel changes in recent weeks, following the wind up of four of its supply chain finance funds linked to embattled finance firm Greensill Capital, and its exposure to the collapse of family office Archegos.

READ Credit Suisse to cut millions from bonus pool after $4.7bn Archegos hit

The bank announced on 6 April that Brian Chin, head of its investment bank, and its chief risk officer Lara Warner, would step down from their roles in the wake of the Archegos collapse.

Credit Suisse has said that it expects to make a loss of $960m in the first three months of the year, after it was forced to take a $4.7bn hit from the collapse of Bill Hwang’s family office, by far the biggest loss of any investment bank exposed to the firm.

In March Credit Suisse replaced its veteran head of asset management, Eric Varvel, with former UBS executive Ulrich Körner.

Despite a shakeup of senior management within the bank, attention is now turning to the Credit Suisse board.

READ Credit Suisse ignored key warnings — then came Archegos and Greensill

“In our view, in order to regain shareholder trust in light of the substantial financial and reputational damage that the company is facing as a result of the aforementioned matters, shareholders would be better served by a change in leadership of the risk committee.”

Credit Suisse was contacted for comment.

To contact the author of this story with feedback or news, email David Ricketts

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