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Credit Suisse says “nothing has changed” after chairman approves Gotstein’s CEO

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Credit Suisse Group said on Friday it had “nothing changed” since chairman Axel Lehmann approved CEO Thomas Gotstein last month after Bloomberg News reported that the bank was considering replacing him.

Referring to people familiar with the matter, Bloomberg said the council held early talks to remove Gotstein. The change could happen this year, according to https://www.bloomberg.com/news/articles/2022-05-13/credit-suisse-weighs-removing-ceo-gottstein-as-soon-as-this- year said.

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A statement from Credit Suisse said it did not comment on rumors or speculation, but added: “The chairman has clearly supported Thomas Gotstein. Nothing has changed in this regard. “

Gotstein took over the top job in 2020 and has since run the bank through a series of scandals. These include a negative regulator for spying on its executives and the collapse of two clients, former British financier Greensill and New York-based investment fund Archegos.

This led to an outflow of key employees and wiped out billions from the market value of the lender from Zurich in 2021.

While the council continues to publicly express support for Gotstein, some members are increasingly worried that he will not cope with the bank’s problems, according to Bloomberg.

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Critics say Gotstein should have better dealt with the risks associated with Archegos, whose collapse resulted in a $ 5.5 billion loss to the bank and noticed red flags in its relationship with Greensill.

In April this year, however, Lehmann told the Swiss newspaper NZZ that he supported Gotstein and that about 10 key investors supported the bank’s board and strategy.

“With so many new meetings, you also need someone upstairs who knows what makes the whole organization tick and who are the main customers,” Lehmann told NZZ. “At the moment we have a good combination of continuity and change.”

Gotstein has replaced former CEO Tijan Tiam, who has been ousted over a devastating spy scandal. In January this year, former chairman Antonio Orta-Osorio abruptly resigned after an internal investigation into his personal behavior, including violations of COVID-19 rules. He was replaced by Lehmann.

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Tired Credit Suisse investors fear a long wait until the bank gets back on track after its scandals have destroyed billions of its market value and put pressure on management, Reuters reported in February.

While Switzerland’s second-largest bank said it could create value by serving its wealthy customers with “care and entrepreneurial spirit”, the market is not yet convinced, and its share price has fallen by almost a third in a year to about 10 billion Swiss. francs ($ 11 billion) from his estimate.

In recent months, his reputation has been shattered again in the first criminal case against a major bank in Switzerland, in which Credit Suisse and a former employee face charges of allowing a Bulgarian cocaine trafficking group to launder millions of euros, some of which were shoved into suitcases.

Credit Suisse has denied all charges, while its employee denies the offense. (Report by Jahnavi Nidumalu of Bangalore; additional reports by Carolina Mandle, John O’Donnell and Brenny Hughes Negawi; edited by Michelle Price, Mark Porter and Matthew Lewis)

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