On Tuesday, March 14, Credit Suisse disclosed “material weaknesses” in its financial reporting processes for 2021 and 2022 that could have resulted in “inaccuracies” in the financial results.
These weaknesses include the lack of effective risk assessment to identify inaccuracies in the bank’s financial reporting and the absence of effective monitoring. Credit Suisse said its management was developing a “remedial plan” to address the problem, but noted that its annual report “fairly presents” its consolidated financial position for the two years. The bank also disclosed that PricewaterhouseCoopers, which audited its 2022 financial statements, also issued an “adverse opinion” on the bank’s “internal control over financial reporting.”
Credit Suisse has had to delay publishing its annual report for a week after receiving a last-minute call from… Securities and Exchange Commission Who was asking about cash flow data for 2019 and 2020, questions now resolved.
The bank, which in February announced its biggest annual loss since the 2008 financial crisis, also revealed that withdrawals from its customers, which increased at the beginning of the fourth quarter of 2022, “have stabilized at much lower levels.” “after reversing”.
In addition to this information, the Crisis Investment Bank also said that its president, Axel Lehmannagreed to waive the annual payment of $1.65 million They usually target senior members of the board of directors.
Owns Credit Suisse shares down more than 4% The next morning to publish the annual report. Bank stocks, along with other banking stocks, have been hit by the global rout triggered by the collapse of Silicon Valley Bank (SVB) last week. However, Credit Suisse’s difficulties predate the collapse of SVB and the value of its shares decreased by more than 80% Since March 2021.
Credit Suisse has been at the center of a series of scandals in recent years. The investment bank declared a loss $1.72 billion In 2021 due to partner fund Greensill Capital going bankrupt and suffered another hit of $5.5000000000 In the aftermath of the collapse of the Archegos Capital hedge fund. After Russia invaded Ukraine last year, the lender came under scrutiny by the US House of Representatives Oversight Committee over its handling of information on assets related to Russian oligarchs. In July, the bank announced it would replace its CEO and undertake a “comprehensive strategic review” as losses piled on. In October, rumors on social media about the financial situation of Credit Suisse sparked some panic in the markets, as well as a wave of customer withdrawals. The company reported losses $8 billion in 2022.
Translated article from the American magazine Forbes – Author: Siladitya Ray
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