Credit Suisse chair re-elected at AGM as shareholders reject CEO pay

Credit Suisse chair Axel Lehmann has been re-elected to the board at the bank's annual general meeting, where he told shareholders he had believed until the eleventh hour that the bank could rescue itself.

Addressing shareholders "in a situation that no one could have anticipated", Lehmann said it was a "sad day".

He said: "The bitterness, anger and shock of all those who are disappointed, overwhelmed and affected by the developments of the past few weeks is palpable."

'It was too late': Credit Suisse chair Lehmann apologises for bank failure

Credit Suisse was rescued by its Swiss rival UBS just over two weeks ago for $3.3bn, a downfall triggered by the publication of its delayed annual results, and the findings themselves revealing the bank's "material weakness".

This occurred at the same time as a regional banking crisis began in the US, causing fears of a second global banking crisis.

The bank had been plagued by a string of scandals in the build-up to its results, which had negatively impacted its profits and share price.

AGM votes

The chair was re-elected for a further term until the closing of the planned merger with UBS.

Alongside Lehmann, Christian Gellerstad was re-elected to the board and appointed vice chair and lead independent director.

Five board members did not stand for re-election: Shan Li, Seraina Macia, Blythe Masters, Richard Meddings and Ana Paula Pessoa.

All other board members were re-elected.

Credit Suisse AT1 bondholders seek to recover losses from UBS

Shareholders also rejected the proposal to award managers, including CEO Ulrich Körner, up to CHF 34m in basic pay, with just 48.23% of shareholders agreeing with the proposition.

"We will have to think about how to respond to that," said Lehmann in response.

The board will now have to come up with a new package that is acceptable to shareholders.

‘I apologise'

At the AGM, Lehmann said the bank's board had "wanted to put all our energy and our efforts into turning the situation around and putting the bank back on track", and it "pained me that we did not have time to do so".

"I apologise that we were no longer able to stem the loss of trust that had accumulated over the years, and for disappointing you," he said.

Lehmann took on the role as Credit Suisse chair a year ago, and he recalled facing a business that needed "comprehensive strategic and cultural transformation" as well as to be "fundamentally overhauled and changed".

Some progress had been made in the past year around regulatory issues and adjusting the risk/return profile, which the chair said had given the board confidence its overhaul could be achieved, despite the significant outflows in October 2022 causing a setback.

"Until the beginning of the fateful week, I believed in a successful turnaround," he said.

"However, rising interest rates, inflation and market volatility shook sentiment, and following the issues around US banks, there were fears of global contagion. Social media and digitalisation fanned the flames of this fear. This hit us at our most vulnerable in mid-March."