The world’s largest state wealth fund wants a better explanation and more responsibility for recent accidents at Credit Suisse CS -2.92%
Norges Bank Investment Management, the Norwegian central bank’s arm that runs the nearly $ 1.3 trillion fund, said Sunday it supports a shareholder proposal for a special review of the bank’s relationship with Greensill Capital, a financing partner that went bankrupt in March 2021. said it was also voting at the bank’s annual shareholders’ meeting on Friday against a proposal to clear Credit Suisse’s board and top management of legal liability.
The polls put more pressure on Credit Suisse, which has taken steps to improve its culture following a wave of scandals. Greensill Capital went bankrupt in March 2021, putting billions of dollars at risk in investments in funds run by Credit Suisse through an asset management arm. That same month, the bank lost about $ 5 billion by leaving large equity positions in the family office Archegos Capital Management.
A shareholder vote to clear the board of liability was skipped last year, while Credit Suisse assessed the damage from the twin scandals. The bank released a report in July on Archegos by a law firm, but has said it will not release the Greensill report because it could hurt its ability to recover assets. The vote, which Norway said it would oppose on Friday, applies to the 2020 financial year and excludes issues related to Greensill. It will support a separate vote on legal liability for the 2021 financial year.
Exemption from liability means that shareholders can not later sue the Board of Directors unless new information emerges that was not known at the time. The vote is largely seen as an approval of the performance of the Board of Directors and senior management during the year.
The Oil Fund, as the Norway unit is known, has a 1.3% stake in Credit Suisse. It owns an average of 1.3% of the world’s listed companies, making it a major investor in companies such as Apple Inc..
and Alibaba Group Holding Ltd.
Its decisions are closely followed by other government investment funds and large capital pools.
Proxy Advisors Institutional Shareholder Services Inc. and Glass, Lewis & Co. also advised shareholders to vote against discharging the Board of Legal Liability for 2020, although they advised to approve it for 2021.
Norway said it would support a proposal from a fund representing Swiss pension funds for a special review of the bank’s decisions regarding Greensill. The bank released some limited details this month about its decisions around Greensill. It said it fired 10 people, including the head of its asset management department, and that they were recalling $ 43 million in salaries.
The Norwegian fund said, “where a company’s disclosure does not meet our needs as a financial investor, we will consider supporting a well-founded shareholder proposal that requires reasonable disclosure.”
As part of its turnaround efforts, Credit Suisse is reviewing senior appointments and succession plans, The Wall Street Journal reported Sunday. Many years of leadership in roles, including the chief financial officer, the attorney general and the Asia chief, may be relocated as the bank makes changes, people with knowledge of the case said.
The bank has said it will deliver a deficit in the first quarter on Wednesday. Last week, it said lawsuits will be around $ 740 million in the quarter due to developments in lawsuits involving a former client who wins a court award of about $ 555 million in Bermuda.
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