By Brenna Hughes Neghaiwi
ZURICH (Reuters) – Credit Suisse’s board will exclude matters relating to the collapse of its Greensill-linked supply chain finance funds (SCFF) when it asks shareholders to grant management a discharge for liabilities at its April AGM, the bank said on Wednesday.
Credit Suisse racked up a 1.6 billion Swiss franc loss in 2021, partly as a result of a $5.5 billion hit from the implosion of investment fund Archegos which hit the bank that March.
Its reputation was also damaged by the collapse of $10 billion in supply chain finance funds linked to insolvent British financier Greensill that same month, for which it is still trying to recover investor funds.
The bank conducted inquiries into both matters, publishing a damning report in July on a “lackadaisical” attitude towards risk and “a lack of accountability” behind the Archegos loss, but in a surprise move, said it would not publish its Greensill report in January.
“Due to the ongoing process to recover investors’ funds, the legal complexities of the SCFF matter, as well as an ongoing regulatory investigation by FINMA, the board does not intend to publish the related report,” the bank said on Wednesday.
“It therefore does not recommend proposing discharge with respect to this matter until the related processes are largely concluded.”
Under Swiss corporate rules, directors can be held responsible for wilful or grossly negligent violations of their duties, with shareholders asked each year to free them from legal liabilities for the previous year.
Approving the vote waives the directors’ or management’s liabilities, but only applies to facts that have been disclosed to shareholders and the claims of the company and shareholders who approved it.
Credit Suisse withdrew an agenda item from its 2021 AGM asking shareholders to approve management’s performance as it conducted investigations into the two scandals.
Now, following investor pushback, it said it would ask shareholders to grant executives and board members a discharge for any liabilities for 2020 and 2021 at its AGM on April 29, but omit matters surrounding the Greensill-linked funds.
Credit Suisse also said it had received a proposal from pension fund adviser Ethos Foundation and other shareholders in March, seeking information and a special audit in connection with the Greensill-linked funds as well.
It said it would provide the corresponding information on its website during the week of April 4, but believed a special audit would “at this stage be detrimental to Credit Suisse and that additional, related disclosure would prejudice the outcome of the recovery processes in particular”.
(Reporting by Brenna Hughes Neghaiwi; Editing by Elaine Hardcastle and Nick Macfie)
