Credit Suisse reported a huge loss for Q1 today (21 April) after the collapse of US hedge fund Archegos made a serious dent in its finances.
The Zurich-headquartered international banking group set out a pre-tax loss of 757m Swiss francs ($819.4m) in its results, plummeting from a CHF1.2bn franc profit in 2020.
The figures were significantly impacted by a CHF4.4bn charge related to US hedge fund Archegos which collapsed in March after defaulting on margin calls.
The loss we report this quarter, because of this matter, is unacceptable."
Thomas Gottstein, chief executive of Credit Suisse Group, said: "The loss we report this quarter, because of this matter, is unacceptable. Together with the board of directors, we have taken significant steps to address this situation as well as the supply chain finance funds matter.
"Among other decisive actions, we have made changes in our senior business and control functions; we have enhanced our risk review across the bank; we have launched independent investigations into these matters by external advisors, supervised by a special committee of the Board; and we have taken several capital-related actions. We will work to ensure Credit Suisse emerges stronger."
He added: "However, it is also important to recognize that our underlying 1Q21 financial performance, across all divisions, was strong, supported by solid results in Switzerland, and strong growth in APAC and investment banking.
"We expect that our successful MCN placement today will further strengthen our balance sheet and enable us to support the momentum in our core franchises. Our underlying result is a testament to the earnings power of Credit Suisse and to the commitment of our employees. And it makes it all the more important that we quickly and decisively resolve the issues we are currently dealing with."