Credit Suisse Group AG’s two-barreled financial crisis has a common topic: banks that look the other way when alarms contend that pulls back into the lucrative corner of business.
The Wall Street-headquartered Swiss bank was caught in late February when a complex $ 10 billion investment run by financing firm Greensill Capital was disclosed despite internal warnings about the relationship. Many years
It then lent more than any other bank in a larger and more concentrated position to Archegos Capital Management, run by longtime client Bill Hwang, although Archegos was identified as a client of particular interest to Credit Suisse. It was slower than other banks and ended up selling the wrong lights.
The bank said on Tuesday it would charge $ 4.7 billion in Archegos trading, the equivalent of more than a year in profit. While no numbers were given on Greensill̵7;s losses, preliminary estimates within the bank indicated that Credit Suisse investor losses could reach $ 1.5 billion, according to a person familiar with the bank.
In a statement on Tuesday, Credit Suisse Chief Executive Thomas Gottstein said, “We are fully committed to handling these situations. Will learn a serious lesson “