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António Horta-Osório joined Credit Suisse as chairman to re-create his fallen profile. He is leaving his mark – in the wrong way. The former Lloyds chief said resigned after violating UK law and the Swiss coronavirus. In particular, he participated in Wimbledon’s 2021 tennis tournament, the winner and skepticist Novak Djokovic.
Credit Suisse has replaced Deutsche Bank as a European lender who can do nothing. Its disaster list includes intelligence, the collapse of Greensill invoice and the removal of hedge fund from Archegos Capital. Credit Suisse has also failed to take advantage of the strong repayment of investment banks since March 2020. They share sales at half the price of the book, compared to 0.8 percent of European banks.
Horta-Osório had the right mix of negotiations and the courage to establish Credit Suisse as a permanent seat. But loving the occasional but bigger mistake has disappointed him. Public statistics do not seem to be ignoring Covid’s security, as illustrated by the plight of Djokovic and UK Prime Minister Boris Johnson.
Axel Lehmann, head of UBS, replaces a Portuguese bank. Rumors are circulating about a Swiss-led conspiracy after years of crisis under foreign powers. This does not seem to be possible. Horta-Osório pressured Lehmann to join the group.
It is true that Horta-Osório replaced Swiss general Thomas Gottstein, a stable and consistent man. Lack of direct information on private banks and depositors was a problem for Lloyds’ former boss here. Lehmann grew up in his own banks and companies.
Disputes between Credit Suisse executives would not prevent a proper settlement, however. Bankers are skeptical that they want to protect the near-term lease after hitting about $ 6bn (so far) from the Archegos show last year, Berenberg thinks.
The share price fell by 5 percent when Horta-Osório announced its plans in November. Advertisers were expecting more and more options. They want the SFr1.1bn ($ 1.2bn) bank overdue to be returned to them, without a refund. Credit Suisse plans to repay at least 25 percent, while many banks raise their interest rates. This is not going well with shareholders, says Citi.
So Lehmann and Gottstein should move forward. They have the blessing and the curse of a bank that has been ruined to work with. Their biggest challenge – the stone markets aside – will be to dispel doubts among foreign investors. He may see Lehmann, right or wrong, as an ordinary candidate, hired to establish the business to the satisfaction of his superiors.
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