Unpacking the report on Credit Suisse’s Archegos disaster

More focus on keeping a client happy than keeping the bank solvent; a risk management department that wasn’t tough enough and enabled bad practice; a willful reduction in margin; and two co-heads who each believed the other ran the relevant business. The report into Credit Suisse’s Archegos debacle makes grim reading.

A business more scared of losing a client than addressing the risks that client was bringing to the bank. That’s the central lesson of the Credit Suisse Group special committee report on Archegos Capital Management compiled by Paul, Weiss, Rifkind, Wharton & Garrison and released to the world today. It’s an expensive lesson: $5.5 billion to be precise.

“The Archegos-related losses sustained by CS are the result of a fundamental failure of management and controls in CS’s investment bank and, specifically, in its Prime Services business,” the report says.

Thanks for your interest in Euromoney!
To unlock this article: