By AMLi Correspondents
THE Chief Risk and Compliance Officer at Credit Suisse is to leave the bank as it took drastic action today over the Greensill Capital saga.
Compliance chief Lara Warner and its investment banking chief, Brian Chin will both leave the bank this month, Credit Suisse confirmed.
The bank is also cutting bonuses amid the fallout from two major business relationships – Greensill Capital and hedge fund Archegos imploded in recent weeks with major losses. Early estimates suggested Credit Suisse stands to lose up to $4BN from the collapse of Archegos.
Credit Suisse’s chief executive, Thomas Gottstein, said in a statement: “The significant loss in our prime services business relating to the failure of a US-based hedge fund is unacceptable.
“In combination with the recent issues around the supply chain finance funds, I recognise that these cases have caused significant concern amongst all our stakeholders.”
Greensill Capital, filed for insolvency earlier this month. In Britain, there are concerns about the future of Liberty Steel which directly employs 3,000 people in the UK. An additional 2,000 people work for GFG Alliance in the UK.
Credit Suisse said it expects to make a $960m (£690m) loss for the first quarter.
It also warned of a $4.7bn loss from Archegos’ implosion alone.
It said it had yet to calculate the cost of its involvement with Greensill Capital.
Archegos is a family business run by controversial former hedge fund manager, Bill Hwang.The Swiss bank was one of several lenders that acted as prime broker to Mr Hwang.
Archegos collapsed after bets it made on stocks unravelled. Shares in one of its holdings, US entertainment giant Viacom, starting falling, forcing it to sell them off in double-quick time.
Credit Suisse was one of the last to try to unload its shares in the company, selling then at just over $40 per share, compared with the $100 it was priced at earlier in March.