Credit Suisse Top Holders Seek to Oust Directors Over Archegos

(Bloomberg) -- Credit Suisse Group AG’s top shareholders have called for the removal of key board members ahead of the bank’s annual general meeting, after mounting losses linked to a failed hedge-fund further eroded confidence in the lender’s leadership.

Norway’s sovereign wealth fund, one of the bank’s top investors, will vote against re-election to the board of six members including lead independent director Severin Schwan, audit committee head Richard Meddings and risk committee head Andreas Gottschling, according to voting instructions published on its website.

Proxy adviser Glass Lewis also advised shareholders to vote against re-electing Gottschling, while David Herro of Harris Associates has called for changes to be made in the bank’s risk control at every level where there are deficiencies.

Shareholder discontent has simmered after Credit Suisse was hit harder than any other competitor by the collapse of Archegos, the family office of U.S. investor Bill Hwang. The bank’s hit from the collapse runs to $5.5 billion so far, prompting it to raise $2 billion from investors and cut the hedge fund unit at the center of the losses.

The Archegos blowup fueled criticism of Credit Suisse’s risk management, as it came just weeks after the bank found itself at the center of the Greensill Capital scandal, when it was forced to suspend investment funds.

Shareholders will vote on compensation and the election of new board members in an annual general meeting on Friday April 30.

“Shareholders would be warranted to also attribute accountability to the board’s risk committee,” Glass Lewis wrote earlier this month, adding that a change in leadership of the risk committee is needed to regain shareholder trust after the recent financial and reputation damage.

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