Credit Suisse’s bankers’ exodus endures
Senior bankers continue to leave Credit Suisse, after the bank cut the amount of money set aside for employee bonuses.
Credit Suisse continues to experience the loss of a “slew” of senior bankers, says Nabila Ahmed on Bloomberg. The defections come as Credit Suisse has “slashed” the amount of money set aside for employee bonuses, using the savings to limit the “financial hit” from the recent implosion of the Archegos fund.
Other “debacles”, including its links to the collapsed supply-chain finance group Greensill Capital, have also hurt its reputation. Managers are now considering offering “retention bonuses” for staff to “stem the bleeding”.
Credit Suisse’s bankers are particularly “frustrated” that the failure of the bank’s prime-brokerage unit, which caters to investors such as Archegos, overshadowed an “otherwise strong” run for the investment bank, says Cara Lombardo in The Wall Street Journal. The bank has advised on several “high-profile transactions” lately, including chipmaker Advanced Micro Devices’ $35bn purchase of rival Xilinx and the $21bn acquisition of Speedway by the Japanese owner of the 7-Eleven convenience-store chain.
Still, there may be some light at the end of the tunnel, says Reuters. Credit Suisse is making “progress” in regaining assets from its suspended Greensill-linked supply chain finance funds. It has recovered $5.9bn out of a possible total of $10bn. This comes after Greensill, which lent money to firms by buying invoices at a discount, collapsed when one of its main insurers declined to renew its cover. That forced Credit Suisse to shut $10bn of supply-chain finance funds that invested in bonds issued by Greensill.