Credit Suisse New Chairman Vows To Tackle Risks

Credit Suisse’s new chairman pledged Friday to tackle risk at the bank as a board member was pushed out following major losses linked to the collapses of two financial firms.

Switzerland’s second largest bank has been under pressure from shareholder groups to clean up its act after being hit hard by bankruptcies at Archegos, a US hedge fund, and British financial firm Greensill.

“The current and potential risks of Credit Suisse need to be a matter of immediate and close scrutiny,” Antonio Horta-Osorio, the former chief of British bank Lloyds, told the Swiss bank’s general assembly.

“I firmly believe that any banker should be at heart a risk manager,” he said shortly after receiving 96.45-percent backing to replace long-time chairman Urs Rohner.

Shockwaves rippled through global financial markets and institutions last month when then little-known Archegos sold at least $20 billion in stocks as it sought to cover obligations to its lenders.

Losses at leading global banks have jumped past $10 billion, with Credit Suisse accounting for around half of the damage.

Credit Suisse had also invested heavily in Greensill, a firm specialised in short-term corporate loans via a complex and opaque business model, and was forced to suspend four funds after the firm declared insolvency last month.