Credit Suisse chief quits over Covid rules breach

The chairman of Credit Suisse has resigned less than a year after taking the reins of the scandal-hit bank following reports that he had broken Covid quarantine rules.

Antonio Horta-Osorio’s resignation was effective immediately, following an investigation commissioned by the board, Switzerland’s second-biggest bank said in a statement Monday.

Axel Lehmann, from the board of directors, was appointed to take his place.

The resignation adds to the woes of the Swiss banking giant, which was rocked by its links to the multi-billion-dollar meltdowns at financial firms Greensill and Archegos last year.

“I regret that a number of my personal actions have led to difficulties for the bank and compromised my ability to represent the bank internally and externally,” Horta-Osorio said in the statement.

“I therefore believe that my resignation is in the interest of the bank and its stakeholders at this crucial time.”

Horta-Osorio was elected chairman in April 2021 with the bank mired in turmoil.

In March, Credit Suisse had been shaken by the collapse of the British finance firm Greensill, in which some $10 billion had been committed via four funds, swiftly followed by the implosion of the US hedge fund Archegos, which cost the bank more than $5 billion.

Crowned with a solid reputation after having successfully turned around the British bank Lloyds, Horta-Osorio promised to put better risk management at the heart of the bank’s culture.

But in December, his image was tarnished by revelations in the press.

– Quarantine –

Following a report by the Swiss newspaper Blick, Credit Suisse confirmed last month that Horta-Osorio had violated quarantine rules.

The Portuguese banker apologised but other quarantine revelations followed and the board launched an investigation.

Switzerland imposed a 10-day quarantine rule on November 26 for people flying in from countries where the Omicron Covid-19 variant had been detected — a measure that chiefly affected Britain.

Blick reported that Horta-Osorio had travelled back to Switzerland from Britain aboard a private jet, then asked if he could be released from quarantine, the tabloid said.

Despite getting no answer from the authorities, Horta-Osorio took a plane to the Iberian peninsula before heading on to New York for a board meeting.

Michael Foeth, an analyst at Vontobel bank, said breaking quarantine rules had created a “credibility problem” for a chairman who had put the culture of personal accountability at the heart of the bank’s transformation.

“We respect Antonio’s decision (to resign) and owe him considerable thanks for his leadership in defining the new strategy, which we will continue to implement over the coming months and years,” said Severin Schwan, vice chair of Credit Suisse’s board.

“Axel Lehmann as the new chairman, with his extensive international and Swiss industry experience, is ideally suited to drive forward the strategic and cultural transformation of the bank,” he said.

– ‘Without distraction’ –

The board will propose that Lehmann, who joined the bank in October and headed the risk committee, take over permanently as chairman at the annual general meeting on April 29, the bank said.

A former executive with rival bank UBS, the Swiss banker, who is in his early 60s, also spent nearly 20 years with the Swiss insurer Zurich Insurance.

“We have set the right course with the new strategy and will continue to embed a stronger risk culture across the firm,” Lehmann said.

“By executing our strategic plan in a timely and disciplined manner, without distraction, I am convinced that Credit Suisse will demonstrate the renewed strength and business focus needed to generate sustainable value for all of our stakeholders,” he said.

At 1053 GMT, Credit Suisse shares were down 1.63 percent to 9.39 Swiss francs, against the trend of the SMI — the benchmark index of the Swiss Stock Exchange — which was up 0.55 percent. — Agence France-Presse