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Heads roll at Credit Suisse following $4.7bn Achegos collapse

06:48, 6 April 2021

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Writing on the wall for Credit Suisse bosses after Achegos and Greensill debacles

Credit Suisse is to part company with chief risk officer Lara Warner, and head of investment banking Brian Chin following the collapse of Achegos Capital and Greensill Capital.

The two companies had strong links with the banking giant, which is predicted to have endured first quarter losses of around £980m (SFr900m).

Achegos and Greensill dealings damage Credit Suisse

The Zurich-based bank came unstuck after backing Achegos Capital, which is run by controversial former hedge fund manager Bill Hwang, to the tune of $4.7bn. Achegos came unstuck after shares it held in several companies fell. It was forced to sell holdings in US entertainment concern Viacom for $40 a share, $60 a share less than they were worth in March.

Mr Chin, who ran the main brokerage division dealing the Achegos shares, shared overall responsibility for the disaster with Ms Warner.

The Achegos losses follow a $160m bridging loan to Greensill Capital, a decision signed off by Ms Warner that went against the advice of other risk managers. Greensill, which was a major backer of Liberty Steel owner GFG Alliance, filed for insolvency earlier this month.

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Losses of ‘significant concern’ to stakeholders

Commenting on the Achegos and Greensill debacle, Credit Suisse chief executive Thomas Gottstein said: “The significant loss in our prime services business relating to the failure of a US-based hedge fund is unacceptable.

“In combination with the recent issues around the supply chain finance funds, I recognise that these cases have caused significant concern amongst all our stakeholders.”

Credit Suisse has announced the replacements for Lara Warner and Brian Chin. Christian Meissner, co-head of international wealth management investment banking advisory, will replace Brian Chin, while Joachim Oechslin and Thomas Grotzer will replace Lara Warner, as interim chief risk officer and interim head of compliance, respectively.

Credit Suisse shares

Credit Suisse shares have shown signs of recovery following a marked drop in price from 12.47 CHF on Friday 26 March to 9.90 CHF on Wednesday 31. The opening price was 10.38 CHF on 6 April, as the announcement about replacement chiefs was made.

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