The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.
Opinion

Greensill: Gottstein’s latest Credit Suisse headache

Thomas Gottstein’s first year in charge of Credit Suisse began with a pandemic. The second has been overshadowed by events surrounding a key client, Greensill Capital, whose collapse revives lingering questions about the bank’s operating model.

Elliot Wilson cap mkts 1920x943.jpg

Many years ago, over a beer at the Kerry Centre hotel in Beijing, a senior US diplomat described diplomatic talks with North Korea as an “endless dizzy dance”. One step forward, he said, led to another sideways, two more back, then a fifth into “somewhere you’d never been before”.

Thomas Gottstein must know the feeling well. Within days of being announced as Credit Suisse’s chief executive in February 2020, a pandemic made landfall in Europe.

The crisis left the 57-year-old unable to travel and meet staff. Last year was a tough one for the Swiss banking giant, with defaults and write-offs from troubled loans tripling to SFr1.1 billion ($1.18 billion). Net income fell 22% year-on-year in 2020, to SFr2.7 billion, with net litigation provisions topping SFr1.2 billion.

If Gottstein hoped for an easier run in 2021, with a swift return to operating normality, he didn’t get it.

Reputational harm

The collapse of Greensill Capital – the Softbank-funded supply chain finance specialist – has already caused Credit Suisse sizeable reputational and financial harm.

The facts as they are (though they change by the day) are worth repeating. On March 1, Credit Suisse said it would suspend $10 billion worth of funds linked to Greensill, citing “considerable uncertainties” over their valuation.


You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree