Credit Suisse Group AG has accumulated more than $ 20 billion in exposure to investments related to Archegos Capital Management, but the bank has struggled to monitor them before the fund is forced to liquidate many of its large positions, according to people familiar with the matter.
The US family investment firm’s bets on a collection of shares rose before the March crash, but parts of the investment bank did not fully implement systems to keep up with Archegos’ rapid growth, people said.
Credit Suisse chief executive Thomas Gottstein and risk-averse general manager Lara Warner, who recently left the bank, only became aware of the bank’s exposure to Archegos in the days leading up to the liquidation of the fund, people familiar with the bank said. Neither Mr. Gottstein nor Mrs. Warner had any background knowledge as a major client prior to this, these people said.
A Credit Suisse spokesman declined to comment.
The exhibition reveals for the first time the scope of Credit Suisse’s relationship with Archegos, which was revealed at the end of last month. Credit Suisse reported a loss of $ 4.7 billion, cut its dividend and said Ms Warner, the head of the investment bank and other employees would leave. Credit Suisse is also facing questions from US and European regulators about its relationship with Archegos and the rebate.