Everybody was hurt one way or another by the bubble burst of 2008. Well, everybody except the people who caused it and profited by it. Sure, there were fines paid which were minimal compared to the haul. Criminal charges? Those occurred mainly in Iceland. Most escaped judicial process, free to do it all again. In addition, they still collected their commissions and bonuses. The calamity wasn't only the financial losses, but the lackadaisical efforts of the Justice Department. Amidst extraordinary loss stands a number of instant billionaires, but no heroes. Until now.
As reported this morning by Max Colchester, Jenny Strasburg, and Margo Patrick writing for the Wall Street Journal, Zurich has a new sheriff in town. Credit Suisse CEO Tidjane Thiam has worked diligently since his appointment in July to unwind the high-risk bets left behind by his predecessors. Still, trading revenues for the investment bank are facing a 45% decline for the quarter.
Efforts to stem future losses include increasing job cuts by 2,000 to bring the total to 6,000. The announcement brought Credit Suisse shares up .9% to 14.45 Swiss francs. Mr. Thiam is also paring down the size of the global markets unit by nearly 30% by exiting out of businesses which include distressed debt. Restructuring efforts are already showing results even though the plan is expected to take 12 to 18 months.
The overall scope of developments at Credit Suisse is indeed monumental, but there's one impressive detail me that tells the hero's tale. The 2015 bonus pool for the Credit Suisse investment bank was cut 36%. Mr. Thiam requested his own bonus for the year be reduced by 40% 'out of solidarity.' Such is the stuff of honorable people. Such people are heroes.
No comments:
Post a Comment