United Kingdom

Antonio Horta-Osorio gets top job at Credit Suisse

The outgoing boss of Lloyds Bank has wasted no time in lining up his next job.

Antonio Horta-Osorio will take over as chairman of Credit Suisse immediately after stepping down from the British lender in April.

The 56-year-old Portuguese banker, who masterminded Lloyds' recovery from the last financial crisis, will be going straight from one challenge to the next.

Antonio Horta-Osorio will take over as chairman of Credit Suisse immediately after stepping down from the British lender in April

While the Covid-19 pandemic has left Lloyds facing huge loan losses and grappling with record low interest rates, Credit Suisse has plenty of problems of its own.

The Zurich-based group is still reeling from a spying scandal which blew apart the staid world of Swiss banking, after it emerged former employees had been put under surveillance. 

And it is preparing to pay out far more than it initially expected in a decade-long dispute over US mortgage investments.

One banking industry source said: 'This could be out of the frying pan and into the fire for Antonio. He did a good job sorting Lloyds out after the financial crisis, but he's going to have a lot on his plate.'

Horta-Osorio could also take a pay cut. He has been paid more than £56million in his nine years at Lloyds, and took home £4.7million in 2019. Credit Suisse has not disclosed what it will pay him, but last year it paid its chairman £3.9million.

The spying affair at Credit Suisse saw chief executive Tidjane Thiam ousted from the bank, even though an internal investigation found no involvement on his part.

The MI5-style surveillance operation began after Iqbal Khan, then boss of Credit Suisse's wealth management arm, left following months of bad blood between him and Thiam. 

Khan had bought the property next door to Thiam in the village of Herrliberg on Lake Zurich's millionaire 'Gold Coast', and spent almost two years bulldozing the house and rebuilding it. The noise infuriated Thiam.

At a party Thiam hosted in 2019, the pair publicly clashed over trees planted on his property. Working with the pair became unbearable, according to sources at the bank, and Khan left months later. 

He was allowed to take a shortened three-month period of 'gardening leave' before he began at rival UBS.

But Pierre-Olivier Bouee, Credit Suisse's chief operating officer and Thiam's closest confidant, became worried that Khan would try to poach its staff. 

He employed surveillance firm Investigo to track Khan and record who he met. A contractor who acted as a middle man between Credit Suisse and Investigo committed suicide as the scandal unravelled.

Bouee was fired over the affair. But the Bond-style scandal is still not in Credit Suisse's past. The Wall Street Journal reported this week that lawyers hired by the bank found two earlier instances of employees being tailed by private investigators.

They were not ordered to do so by the same people, lawyers claimed, throwing doubt on Credit Suisse's assertion that it does not condone spying.

Reputational issues did not end there. In October, Credit Suisse was caught in a racism storm when chairman Urs Rohner, whose place Horta-Osorio will take, held a 60th birthday party with a black entertainer dressed as a cleaner who sang as he swept the floor. 

Rohner's friends dressed up and danced in Afro wigs. The only black guest – Thiam – left in disgust.

Credit Suisse also announced yesterday that it may have to pay out £500million damages in a historic lawsuit, far more than the £220million it had first suggested.

The bank has been locked in a legal battle with insurer MBIA since 2009 over home loans that banks sell on to investors, who then receive interest payments.

Following the financial crisis, their value fell and several investors have been trying to sue.

The bank hopes Horta-Osorio can provide a breath of fresh air. He was widely credited with returning Lloyds to private ownership nine years after its £20billion taxpayer bailout in 2008.

And he championed mental health safeguards in the workplace after suffering stress-induced insomnia at Lloyds.

Rohner said: 'I am extremely happy we can propose a highly proven and recognised professional of the international banking business as my successor.'

Horta-Osorio will be replaced by HSBC's Charlie Nunn at Lloyds late next year.

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