The financial circle is worse than it, the big bank has lost money one after another, the chairman who came to fight the fire has been working for 8 months to flash his words, and he has become the first large Swiss bank to be criminally prosecuted for allegedly helping drug dealers launder money.
According to the latest annual report, while Wall Street banks have set record for the best profits in history, Credit Suisse has lost money due to a series of thunderstorms, with a net loss of 1.572 billion Swiss francs (about 10.8 billion yuan) a year, while the losses from lightning strikes and lawsuits are as high as 7.6 billion Swiss francs (about 52 billion yuan). Compared to 2020, the company's annual profit was 2.7 billion francs (about 18.5 billion yuan).
The continuous thunder loss is 50 billion yuan
In 2021, Credit Suisse was in a bad year. The first case the big bank encountered was the bankruptcy of the supply chain fund.
Credit Suisse partnered with a financial institution called Greenhill to set up a supply chain finance fund and packaged borrowing notes into investment products to sell to investors as low-risk financial products.
Greenhill, who can connect with Switzerland's second-largest bank, is not an unknown person, and it mainly profits by providing funds to upstream companies, so-called supply chain finance. The burgeoning financial firm, which received a $1.5 billion investment from the SoftBank Vision Fund and was recognized as an official lender by the UK government during the pandemic, went bankrupt because of poor risk management and difficulties for upstream companies to repay their loans.
In the end, the $10 billion supply chain fund was frozen and liquidated, at least close to $3 billion of the funds were difficult to recover due to the bankruptcy of the upstream company, and investors who suffered losses launched a class action lawsuit, and Credit Suisse needed to pay compensation out of his own pocket.
According to the annual report, Credit Suisse has made 6 cash payments to investors and is actively seeking to recover losses from rights and insurance, and investors have received about $6.7 billion in cash payments.
The Fund has repaid $6.7 billion
Another case involved archegos, a hedge fund that blew up $20 billion in a day, setting a record single-day upset in history.
This little-known US fund, in the stock market recovery stage after the outbreak of the epidemic, used high leverage to buy a small number of Internet and media companies, including Tencent Music, Vipshop and other Chinese stocks, in the first half of 2021, this fund was blown up due to nearly 10 times leverage.
Among them, the investment banks that provide financial leverage have lost a total of $10 billion, and Credit Suisse is the main one, accounting for more than half.
According to the annual report, the special loss in response to major events for the whole year amounted to 7.6 billion Swiss francs (about 52 billion yuan), and the hedge fund's liquidation caused a loss of 4.8 billion Swiss francs (about 33 billion yuan), in addition to 1.6 billion Swiss francs of goodwill impairment and 1.2 billion yuan of litigation provisions. Credit Suisse discontinued its entire line of business serving hedge fund trading.
The chairman's flashback was also suspected of money laundering
Entering 2022, good luck does not seem to have come to the head of this big line, first of all, the chairman's flash.
Financier Osorio became a firefighter who rescued a private bank from bankruptcy during the financial crisis, but this time failed to continue the myth.
Unexpectedly, his exit was due to two consecutive violations of the epidemic prevention regulations of the United Kingdom and Switzerland. One left Switzerland before the end of the mandatory quarantine period, and the other went directly to the Wimbledon tennis final in London without quarantine.
After being questioned for his weak sense of risk and difficulty in continuing in this position, Osorio offered his resignation in January and was immediately replaced, less than nine months after he took office. He also personally said that his personal actions have caused difficulties to the bank, impairing its ability to represent the bank, and his resignation is in the interests of the bank and stakeholders.
And that's not all, the ill-fated bank is even more involved in a criminal case.
On February 7, a Swiss court accused Credit Suisse of lacking measures to respond to the amount of aiding drug traffickers in laundering money and demanded 42.4 million Swiss francs in damages.
The court prosecutor argued that between 2004 and 2008, Credit Suisse and its former account manager did not take all necessary measures to prevent suspected drug traffickers from hiding and laundering money.
The indictment, which is more than 500 pages long, revolves around Credit Suisse and its former employee and a former Bulgarian wrestler who the court found helped the Bulgarian client in a transaction of hundreds of millions of Swiss francs, obscuring the source of funding. The client was later convicted of illegal drug dealing in Italy in 2017, money laundering in Bulgaria in 2018 and arrested in Ukraine last year.
At present, Credit Suisse has denied the illegal source of the transaction funds and is still actively responding to the lawsuit.
Credit Suisse U.S. stocks have fallen more than 30 percent since last year's highs, and pre-market trading has fallen 4 percent after the annual report was disclosed.
This article originated from China Fund News