Credit Suisse boss forced to reject takeover rumours

CREDIT Suisse’s chief executive has brushed off claims that the bank is facing a takeover after a slew of scandals and disappointing results.

Swiss blog Inside Paradeplatz reported on Wednesday that US financial giant State Street could make a bid for Credit Suisse at nine Swiss francs a share, valuing the bank at about 23bn Swiss francs (£19bn).

Thomas Gottstein, the Swiss lender’s chief executive, said: “We never comment on rumours. And my father once gave me advice: for really stupid questions, you better not comment at all. So I think I will listen to my father’s advice on this one.”

Shares in the troubled Swiss lender tumbled to a 30-year low of 6.2 Swiss francs on Wednesday morning after the bank announced that “the year 2022 will remain one of transition”, following its sixth profit warning in seven quarters.

However, rumours of the potential takeover sent the stock soaring in the afternoon and Credit Suisse finished the day up almost 4pc. Yesterday it was trading 3pc in the red.

Credit Suisse stock has fallen by 73pc over the past eight years, with the bank having lost half its value over the past 12 months. In March 2021, the Zurich-based bank took a $10bn (£8bn) hit from the collapse of supply chain finance firm Greensill Capital, as well as another separate $5bn loss from the implosion of US hedge fund Archegos Capital.

Mr Gottstein took over the reins in 2020 after Tidjane Thiam resigned following a scandal in which the company was found to have spied on its former staff.

Yesterday, the bank said it would “accelerate” its “cost initiatives across the group with the aim of maximising savings from 2023 onwards”.

It is understood that this process may involve layoffs. Credit Suisse is considering a reduction in headcount across several divisions, according to Bloomberg, including its investment banking and wealth management divisions.

Some analysts have voiced their doubts over the benefits of a deal between State Street and Credit Suisse.

“I am highly sceptical”, said Andreas Venditti, head of banks research at Vontobel Asset Management.

“I do not think it makes sense due to a number of reasons, including State Street’s lack of experience in retail, corporate and investment banking – and wealth management – as well as Credit Suisse’s legacy issues”.