Company Overview

Credit Suisse Group, the second-largest financial services firm in Switzerland behind UBS, became one global brand with the merging of business units Credit Suisse and Credit Suisse First Boston in 2006.  The global company now combines investment banking, private banking, and asset management, with offices in more than 50 countries and 220 branches of its retail banks in Switzerland.

Previously, Credit Suisse First Boston, known as CSFB, was the only top-ten investment bank owned by a non-U.S. entity. In January 1997, CSFB was fully integrated into Switzerland’s Credit Suisse Group, culminating a relationship that began with a minority investment by Credit Suisse nearly 20 years before. The integration gave CSFB a new client base and line of products and services that has allowed it to become a bulge-bracket firm in the United States and a prominent fixture on the global financial scene. It has a long reputation for excellence—both inside and outside of the United States—in M&A, equity underwriting, sales and trading, I-banking, and investment research. In 2004, for instance, CSFB co-led and -managed Google’s IPO, with Morgan Stanley.

The last several years have seen constant change. In 2001, John Mack—known as “Mack the Knife” while heading Morgan Stanley—came on board as CEO. The firm cut about 20 percent of its investment banking employees and cut back on employee compensation. Restructuring followed in 2004 and 2005. Still, the bank’s performance lagged behind competitors. As a result of the poor performance and Mack’s clashing with his boss at Credit Suisse Group, he was let go and replaced by Brady Dougan—who then went on to become the first non-German speaker with full CEO duties for the bank in 2007. The same year, Credit Suisse combined four private banks and one securities dealer into Clariden Leu in order to cut costs during a difficult year not only for the entire investment banking industry suffering the effects of the U.S. subprime mortgage crisis.

In 2008, the company announced it had reviewed results and operations for 2007 and discovered that rogue traders had intentionally mis-priced assets, affecting first-quarter numbers.  Several traders being investigated were suspended, and the bank announced $2.65 billion in write-downs. That same year, it also rejected a bailout offer from the Swiss government, and instead worked to secure $8.7 billion in capital from private investors, mainly Qatar Investment Authority, which owns 9 percent of the bank. Unfortunately, the company still felt losses, as consumer and shareholder confidence fell due to the global credit market freeze. In December 2008 Credit Suisse announced plans to cut 5,000 jobs (11 percent of its workforce) as a result.

The firm has also been expanding on a global level in recent years, acquiring a majority stake in a Brazilian asset manager Hedging Griffo and a 30-percent stake in Korean firm Woori Asset Management in 2007.  It also added operations in Kazakhstan and Turkey after acquiring Baran Securities.