Credit Suisse Group
|Credit Suisse Group|
|Key People||CEO Tidjane Thiam|
|Products||Retail and investment banking and brokerage|
Credit Suisse Group, founded more than 150 years ago, is Switzerland's second-largest financial-services company behind Union Bank of Switzerland (UBS). Beginning in the late 1980s the group rapidly acquired a number of large financial-services companies in Switzerland and abroad but later streamlined its operations. It was also hurt by the U.S. sub-prime mortgage meltdown in 2007.
As of 2014, Credit Suisse has around 2.2 million clients worldwide and 46,000 employees.
In 2002 Credit Suisse Group (CSG) was streamlined into three business units: corporate/investment banking, asset management and private banking. Four years later the group reorganized again, merging the three branches under a single Credit Suisse umbrella and dropping the tarnished Credit Suisse First Boston (CSFB) brand. Later in 2006 CSG sold insurance and pensions arm Winterthur, which it had acquired in 1997, to French financial services giant AXA for $10 billion cash.
- Tidjane Thiam, Chief Executive Officer
Losses and Crises
In late April 2008, CSG posted a net loss for the first quarter of $2.1 million (CHF2.15 billion), almost triple analysts' expectations of around CHF857 million, on investment writedowns of $5.3 billion. By contrast, CSG recorded a profit for the first quarter 2007 of CHF2.8 billion.
Earlier in April, Credit Suisse Group announced it would cut 500 jobs in administration and investment banking in anticipation of the first quarter loss. Dougan had already cut 500 jobs from investment banking in January 2008 and another 320 late last year. Credit Suisse had announced one month earlier that it had been forced to revise the securities valuations in its Collateralized Debt Obligation (CDO) investments due to "intentional misconduct" by some of its traders. Credit Suisse's total valuation reduction on the CDO securities now totals $2.65 billion.
In November of 2012, Credit Suisse was sued by Attorney General Eric T. Schneiderman for making fraudulent misrepresentations of the risks associated with $93.8 billion in mortgage-backed securities issued in 2006 and 2007, and creating damages of $11.2 billion.
In May of 2014, the bank admitted to helping U.S. taxpayers hide offshore accounts from the Internal Revenue Service. In a plea deal, Credit Suisse agreed to pay a total of $2.6 billion – $1.8 billion to the Department of Justice for the U.S. Treasury, $100 million to the Federal Reserve, and $715 million to the New York State Department of Financial Services. Credit Suisse became the most prominent bank to plead guilty in the United States since Drexel Burnham Lambert in 1989, and the largest to do so since the Bankers Trust in 1999.
The company's investment banking and wealth management operations are global, but the commercial banking operation in the United States is largely confined to its New York branch, which held about $72 billion in assets in 2013.
- Credit Suisse Group. SourceWatch.
- Credit Suisse 2013 Annual Report. Credit Suisse.
- Credit Suisse Investment Banking firm profile. vault.com.
- Credit Suisse writes off $5.3 billion. International Herald Tribune.
- Credit Suisse Cutting 500 Jobs as Client Demand Wanes. Bloomberg.
- Press Release. Credit Suisse.
- A.G. Schneiderman Sues Credit Suisse For Fraudulent Residential Mortgage-Backed Securities. Attorney General.
- Credit Suisse Waits for $11 Billion Answer in N.Y. Fraud. Bloomberg.
- U.S. Announces Credit Suisse Guilty Plea. The Wall Street Journal.
- Credit Suisse fined $2.6bn in US tax evasion case. Switzerland News.
- Mixed Signals in a Corporate Felon's Punishment. The New York Times.