Credit Suisse committed a “serious breach of Swiss supervisory law” in its involvement in the Greensill scandal according to Finma, the nation’s financial regulator.
Finma argued the Swiss lender had failed to “adequately identify, limit and monitor risks in the context of the business relationship with Lex Greensill over a period of years.”
The bank lost close to US$10bln in funds when the stock lending company collapsed in March 2021.
Before the collapse, Credit Suisse would purchase the securitised debt from Greensill for its clients to invest in.
However, with no company left to repay the bank it was left without a way to pay back investors.
The Swiss bank has attempted to reclaim the funds it lost from its involvement with Greensill, so far it has recovered US$7.4bln with the last part of the funds appearing to be the most difficult to regain.
The Swiss regulator revealed it would be investigating four former Credit Suisse managers that were involved in the bank’s dealings with Greensill.
“Finma found serious deficiencies in the bank’s organisational structures during the period under investigation. Furthermore, it did not sufficiently fulfil its supervisory duties as an asset manager,” the regulator said.
Ulrich Korner, the bank's chief executive, added that the regulator's findings mirrored those of Credit Suisse’s independent investigation and that it reinforced the actions it was taking to improve the company’s risk and compliance culture.
Today’s news is yet another addition to the scandals the bank has faced over the past few years.
Credit Suisse has previously been criminally convicted for money laundering, embroiled in the collapse of hedge fund Archegos and found stalking senior executives.
The bank is also being investigated for market manipulation after Korner in December told customers that outflows were slowing, when in fact they had not.
Credit Suisse’s share price continues to plummet and has lost more than 60% of its value from a year ago and is now trading at SFr2 2.83 (£2.50).