Credit Suisse Chairman Axel Lehmann and CEO Ulrich Korner on Tuesday addressed the Switzerland-based bank’s near-collapse and UBS’s planned takeover of it.
In a speech published on the bank’s investor website, Lehmann said it "pains" him that the bank’s leaders "didn’t have the time" to get the beleaguered bank "back on track" and that their plans "were disrupted" in March. He said he was sorry they "were no longer able to stem the loss of trust that had accumulated over the years, and for disappointing you."
Lehmann’s speech was delivered at the bank’s annual general meeting roughly two weeks after UBS and Credit Suisse agreed to an $3.2 billion deal involving a takeover by the former. It was arranged by Swiss officials.
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Lehmann said he "believed in a successful turnaround" of Credit Suisse "until the beginning of the fateful week." He pointed to sentiment, which he said had been impacted by factors like interest rates and inflation, and contagion fears, which were related to a couple banks collapsing in the U.S.
Silicon Valley Bank and Signature Bank were taken over by the U.S. Federal Deposit Insurance Corporation in March, with another bank, Silvergate, having folded not long prior to that. Those collapses were followed by turbulence in the market, particularly among some banking stocks.
Credit Suisse, Lehmann noted, also faced a "major setback" in October with "massive" outflows. It "could not be saved" despite efforts to do so, he said.
Lehmann told shareholders the UBS merger "had to go through," arguing a restructuring would have "led to the worst scenario." He called the board approving the transaction "one of the most difficult moments" for him.
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Korner, who also spoke at the meeting, offered a sentiment similar to Lehmann’s about the company running out of time for the revamping that had been planned for it, saying it "fills me with sorrow," according to prepared remarks.
"What has happened over the past few weeks will continue to affect me personally and many others for a long time to come," the CEO said.
"The collapse of Credit Suisse would have been catastrophic not just for Switzerland but for the global economy," Korner said. "Together with the Swiss Federal Council, the Swiss National Bank and FINMA, we worked hard to find possible solutions within a limited timeframe. In the end, the merger with UBS was the only feasible option."
The deal came about without shareholder approval. It was slammed by many shareholders who attended the meeting, according to Reuters.
A probe has been launched by Swiss prosecutors in connection to the agreement, FOX Business previously reported.
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Credit Suisse's stock was trading at $0.89 on Monday afternoon, marking an over 71% plunge since the beginning of 2023 and a nearly 89% drop over a one-year span.
