Credit Suisse shareholders refuse to pay directors a fixed salary of 34 million

“This is a sad day for everyone. Bitterness, anger and juice of those affected by the events is more than tangible. With these words, the president of Credit Suisse, Axel Lehmann, began his speech before the shareholders’ meeting, which will not be repeated, after the collapse of the bank with 167 years of history, which is already in full merger with UBS. Dozens of small investors dressed in protest elements used yesterday’s meeting in Zurich (Switzerland) to show their rejection of the operation which was closed without complying with the rules for this type of transaction, including the mandate to put them to a vote. by shareholders.

The merger also resulted in losses of 17,000 million euros for the bank’s bondholders, which caused panic throughout the sector in Europe, where the rule dictates that shareholders must first bear the costs of a possible bankruptcy. A large group of those obligees, namely, has already hired the prestigious law firm Quinn Emanuel Urquhart & Sullivan to demand compensation. And yesterday they made their frustration known. One of them even used a coconut shell during his speech to show his anger at the losses suffered, alluding to a financial product (CoCos) that suffered bankruptcy.

The commotion was absolute. “I sincerely apologize. We didn’t know how to stop the impact of the legacy scandals,” Lehmann justified in his speech, in which, in addition to blaming past mistakes, he recognized the bank’s inability to deal with the loss of confidence suffered in the black week, with the rush of deposits that got out of control after the collapse of several regional banks in the USA.

“There was no other option: either merger or bankruptcy,” he said, stressing that restructuring according to classic banking rules “would lead to the worst possible scenario, with losses for shareholders, unpredictable risks for clients” and possible global banking. infection.

Harsh criticism from shareholders resulted yesterday in the refusal to pay a fixed salary of 34 million to the bank’s Executive Board, which will remain unpaid until the merger with UBS is completed. The 2022 compensation plan was approved, although managers decided to forgo their bonuses in an attempt to contain the difficult months ahead. According to initial estimates, UBS will have to lay off between 20 and 30 percent of its workforce after the completion of the acquisition, which would mean 36,000 layoffs worldwide.