Chairman António Horta-Osório had promised to deliver a much-needed shake-up of Credit Suisse’s culture
Photo: Jason Alden/Bloomberg News
Credit Suisse’s CS 0.38% New Year’s resolution for a steady, boring 2022 has already fallen by the wayside.
António Horta-Osório’s surprise resignation late Sunday from the helm of the beleaguered lender raises the suspicion that his departure might be due to more than the chairman’s stated coronavirus infractions. The outsider had promised to deliver a much-needed shake-up of the Swiss bank’s culture. His exit puts pressure on successor Axel Lehmann to show that the transformation will continue.
Many investors expected Mr. Horta-Osório to weather his two breaches of Covid-19 quarantine rules with an apology and possibly a fine or some other small sanctions. His departure could mean that the board wants to demonstrate that rule breaking won’t be tolerated, but there is a more worrisome interpretation: that the incidents presented an opportunity to get rid of someone who was making life uncomfortable.
The Portuguese banker built a reputation as a hands-on leader during his cleanup of Britain’s Lloyds Banking Group after the 2008 financial crisis. He arrived last April at Credit Suisse tasked with overhauling a company hit hard by a spying scandal and big financial losses from the Archegos and Greensill affairs. Mr. Horta-Osório took the lead and made a number of senior personnel changes, including bringing Axel Lehman onto the board.
In November, the departing chairman outlined a new strategy for the bank with the primary objective of strengthening its risk culture while maintaining its “entrepreneurial spirit.” He also warned that there were no quick fixes, just a lot of work to do. Some had hoped for a more dramatic overhaul. The new leader said he plans to stay the current course.
Unfortunately for international investors, Mr. Lehmann is a lesser-known quantity than his predecessor. He has held senior positions for over a decade at crosstown rival UBS and he spent nearly twice that long at Zurich Insurance Group, but lacks direct experience leading the overhaul of a bank. The current strategy comes with few ways of objectively measuring its future progress, beyond an absence of crises.
This week’s resignation may not count as a crisis, but it raises awkward questions that are hard for the bank to answer. The shares fell by roughly 2% in the European morning Monday, and continue to trade for about half of their book value. Investors could glean some early insight into Mr. Lehmann from how he deals with the findings of a new report into the Greensill affair, though his options might be limited by the continuing legal battle to recover money. If so, he needs to find other convincing ways to show that the bank is still on the wagon.
Write to Rochelle Toplensky at [email protected]
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Appeared in the January 18, 2022, print edition as ‘Credit Suisse Pressed to Show Change.’
