Credit Suisse “seriously breached its supervisory obligations” in its relationship with Greensill Capital, according to the Swiss financial watchdog Finma.
Finma said the failures were due to poor risk management and “serious deficiencies” in its organisational structures
After concluding its probe, Finma has ordered the bank to “periodically review” its most important business relationships, in particular its counterparty risks.
Credit Suisse will also be required to record the responsibilities of around 600 of its highest-ranking employees.
The watchdog has opened enforcement proceedings against four former Credit Suisse managers, who Finma did not name.
Ulrich Koerner, CEO of Credit Suisse said: “We welcome the conclusion of Finma’s work. Finma’s review has reinforced many of the findings of the board-initiated independent review and underlines the importance of the actions we have taken in recent years to strengthen our risk and compliance culture.”
“We also continue to focus on maximizing recovery for fund investors,” Koerner said.
When Greensill Capital collapsed in March 2021, Credit Suisse closed four funds at short notice, at the time with close to $10bn was trapped in the funds.
Around 74 per cent of the total cash has been collected following a long and expensive legal battle. although the final portion is expected to be the most difficult to recoup.
Credit Suisse is undergoing a restructuring programme after suffering from a string of scandals over the last few years, but the process has already been buffeted by poor market reaction and continuing scandals.
Just last week Reuters reported Finma was scrutinising whether Chair Axel Lehmann was aware that investors were still pulling cash from the firm when he told media that outflows had stabilised.
Earlier this month, Credit Suisse reported its heaviest annual loss since financial crisis after clients scrambled to withdraw cash, and bosses warned that a further “substantial” losses would come this year.