View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. News
September 12, 2022

Credit Suisse weighing option to offer equity stake to top dealmakers

The board members of Credit Suisse Group have presented an idea of allowing its senior dealmakers to own equity stakes at the bank as part of a plan to retain talent and reduce costs, reported Bloomberg.

The idea was rendered to the Swiss banking group’s senior investment bankers by Michael Klein and Blythe Masters at a global townhall meeting held last Thursday, stated the news agency citing sources privy to the matter.

Both Klein and Masters are members of the board of directors of Credit Suisse.

The newly proposed option could lead to a spinout of the firm’s advisory and underwriting arm.

However, no details over the consequences of the option, if it is implemented, were provided by the directors.

The amount of interest shown by Credit Suisse, which is working to overhaul its unprofitable investment bank, also remains vague.   

According to Bloomberg, a bank representative has refused to make any comment on the development.

Credit Suisse is yet to finalise the fate of its investment bank amid commitment to its investors to reduce expenses of the beleaguered unit.

In addition, the bank’s board members have provided different views on the level of reductions that should be carried out without affecting services offered to its wealth management clients, stated the source.

Even though Credit Suisse offered as much as $1.3bn in retention packages and awards to contain departures, the group witnessed the exit of over 60 senior dealmakers in the last two years.

By offering direct stake to the dealmakers, the bank aims to reduce the share of new dealmaking profits. This structure could give less incentives to the bankers and allow Credit Suisse to focus on other divisions.

The latest development comes as Credit Suisse Group announced a deal to buy out its Chinese partner’s remain stake in a local joint venture (JV) for CNY1.14 billion ($160m).

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. A weekly roundup of the latest news and analysis, sent every Wednesday. The industry's most comprehensive news and information delivered every month.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU

Thank you for subscribing to Private Banker International