Credit score Suisse faces anger at remaining shareholder assembly By Reuters

© Reuters. FILE PHOTO: The brand of Credit score Suisse financial institution is seen outdoors its workplace constructing in Hong Kong, China March 20, 2023. REUTERS/Tyrone Siu/File Picture

By Noele Illien and John O’Donnell

ZURICH (Reuters) – Credit score Suisse will face shareholder anger on Tuesday at what will probably be its remaining annual common assembly after the financial institution was rescued final month by Swiss rival UBS.

The hastily-arranged takeover by Zurich-based UBS, for which Switzerland invoked emergency laws, bypassed Credit score Suisse shareholders, who would in any other case have had a say, and largely worn out the worth of their holdings.

Tuesday’s shareholder assembly marks an ignominious finish for the 167-year-old flagship financial institution based by Alfred Escher, a Swiss magnate affectionately dubbed King Alfred I, who helped construct the nation’s railways after which Credit score Suisse.

After years of scandal and losses, Credit score Suisse got here to the brink of collapse earlier than UBS rode to the rescue with a shotgun merger engineered and bankrolled by the Swiss authorities. 

The assembly is the primary time that Chairman Axel Lehmann and Chief Govt Ulrich Koerner will publicly deal with shareholders for the reason that takeover was introduced.

Credit score Suisse had been making an attempt to place the previous behind it and restructure, earlier than a shock triggered by the collapse of Silicon Valley Financial institution within the U.S. despatched it right into a spiral.

After a run on deposits, the Swiss authorities turned to UBS, which agreed to purchase Credit score Suisse for 3 billion Swiss francs ($3.3 billion), a fraction of its earlier market worth.

One of many world’s largest buyers, Norway’s sovereign wealth fund mentioned it could vote towards the re-election of Lehmann and 6 different administrators, in a public present of protest.

U.S. proxy advisor Institutional Shareholder Providers (ISS) had earlier rebuked the financial institution’s administration for “lack of oversight and poor stewardship”.

Within the lead as much as Tuesday, Credit score Suisse mentioned it had withdrawn sure proposals from the assembly’s agenda.

These embrace the discharge of administration, which is usually a bellwether of confidence. It additionally ditched plans for a particular bonus linked to the financial institution’s transformation plan.

Credit score Suisse’s close to collapse not solely wiped billions of Swiss francs off the worth of its shares. It additionally fully worn out $17 billion of Further Tier 1 (AT1) debt.

A bunch of AT1 buyers has employed regulation agency Quinn Emanuel Urquhart & Sullivan to demand compensation.

In the meantime, the workplace of the lawyer common on Sunday mentioned Switzerland’s Federal Prosecutor has opened an investigation into the Credit score Suisse takeover.

The prosecutor is trying into potential breaches of Swiss prison regulation by authorities officers, regulators and executives on the two banks.

($1 = 0.9129 Swiss francs)

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