Credit Suisse, whose shares have lost about 40% since CEO Tidjane Thiam announced an overhaul in October, “hasn’t worked” as a long-term investment for one of its biggest shareholders, Harris Associates.
“We’ve owned Credit Suisse for a long time - it hasn’t worked, it’s been a drag on our numbers,’ David Herro, chief investment officer of Harris Associates, said in an interview with Tom Keene on Bloomberg Radio on Monday. “They are now well capitalized. Some of these things can really take a lot of time to work and I do hope it will.”
Bloomberg News reports that Thiam, 53, who took the top job last year, has failed to restore investor confidence in Switzerland’s second-largest lender as he’s restructuring businesses to meet tougher capital rules and bolster profitability. While he’s staked much of his strategy on growth in wealth management and scaled back from investment-banking businesses including macro trading and prime services, the shares extended losses this year.
While Harris Associates has held stock in Credit Suisse for more than a decade, other investors have fled. Credit Suisse shares have dropped about 33% this year after decreasing 11% in 2015, hitting the lowest since 1989 last month.
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