Credit Suisse
Encyclopedia
The Credit Suisse Group AG is a Swiss multinational
financial services
company headquartered in Zurich
, with more than 250 branches in Switzerland and operations in more than 50 countries.
in 1856 under the name Schweizerische Kreditanstalt (SKA, Swiss Credit Institution).
In 1942, it opened its first branch outside of Switzerland, in New York City.
In 1988, it gained a controlling stake in The First Boston Corporation and in 1993, Credit Suisse Group bought Schweizerische Volksbank (People's Bank of Switzerland). In 1996 the two retail banks were merged and renamed Credit Suisse.
In 2000, it acquired the investment bank Donaldson, Lufkin & Jenrette
(DLJ) and, with it, an e-commerce software portfolio, including DLJ Direct, that it later sold to the Bank of Montreal
.
In 2009, Credit Suisse was recognized as "Bank of the Year" by the International Financing Review.
In November 2011, CS announced to launch a new Algorithmic Index Platform to support the Quantitative Risk Management(QRM) to provide their clients a tailored solution to gain efficient exposure to a range of systematic equity investment strategies.
Credit Suisse is considered to be within the prestigious "bulge bracket
" of investment banks.
The firm earned accolades throughout the recent financial crises for prudent risk management and strategic allocation of capital. It is one of the few major international banks to weather the crisis without any direct government support.
U.S. registered broker-dealer subsidiary, became a subsidiary of DLJ, and DLJ changed its name to CSFB USA.
Prior to the DLJ Merger, the Credit Suisse Group (CS) purchased First Boston in 1988 creating CS First Boston. The firm's bulge bracket status came after the merger with Donaldson, Lufkin & Jenrette
(DLJ).
.
, Private Banking
, and Asset Management. Shared Services
, which includes functions such as IT, marketing and legal/compliance, encompasses all three major
areas. On January 16, 2006, Credit Suisse First Boston (CSFB), now the Investment Banking division, Credit Suisse Asset Management (CSAM), and Credit Suisse Private Banking (CSPB), re-branded themselves, becoming collectively known as Credit Suisse. This move was initiated to better leverage each others' resources and capabilities to create a "One Bank" brand and effort.
The Credit Suisse business unit is a provider of wide-ranging financial services in Europe and other selected markets. It offers investment products, private banking and financial advisory services for private and corporate clients. Credit Suisse was founded by Alfred Escher
.
. It is active in investment banking
, capital markets and financial services. It is a member of the prestigious bulge bracket
of securities firms.
sector Credit Suisse provides advice and investment products and services for high net worth individual
s globally. Credit Suisse's structured advisory process encompasses both asset and liability management. Furthermore, Credit Suisse is a provider of alternative investment products. Wealth management solutions include tax planning; pension planning; life insurance solutions; wealth and inheritance advice, trusts and foundations. Credit Suisse offers multiple booking platforms and global execution capabilities. In Switzerland, Credit Suisse supplies banking products and services to private banking clients as well as to business and retail clients.
Until 2006 this division was known as Credit Suisse Private Banking or CSPB.
, private equity and volatility management. Credit Suisse's asset management business manages portfolios, mutual funds, and other investment vehicles for a broad spectrum of clients ranging from governments, institutions and corporations to private individuals. With offices in 23 countries, Credit Suisse's asset management business is operated as a globally integrated network. Credit Suisse uses the Credit Risk+ method under their financial products arm, to estimate the distribution and expected loss incurred by companies. They also help banks to calculate their capital reserves needed to buffer against credit/default risk.
Winterthur
was divested from Credit Suisse on June 14, 2006. AXA
acquired the leading Swiss insurance company from Credit Suisse Group for about €8 billion.
The CIO of Credit Suisse is Karl Landert, located in Zurich, Switzerland.
's majority shareholder between 2001 and 2005 and then a sponsor between 2006 and 2009 when the team was known as BMW-Sauber.
Credit Suisse is sponsor of the Switzerland national football team
and Roger Federer
.
Lloyds Banking Group
, Barclays, and several other banks were involved with similar information stripping scandals around the same time as Credit Suisse.
Multinational corporation
A multi national corporation or enterprise , is a corporation or an enterprise that manages production or delivers services in more than one country. It can also be referred to as an international corporation...
financial services
Financial services
Financial services refer to services provided by the finance industry. The finance industry encompasses a broad range of organizations that deal with the management of money. Among these organizations are credit unions, banks, credit card companies, insurance companies, consumer finance companies,...
company headquartered in Zurich
Zürich
Zurich is the largest city in Switzerland and the capital of the canton of Zurich. It is located in central Switzerland at the northwestern tip of Lake Zurich...
, with more than 250 branches in Switzerland and operations in more than 50 countries.
History
Credit Suisse was founded by Alfred EscherAlfred Escher
Alfred Escher was a Swiss politician and railway entrepreneur. A member of the Swiss National Council from 1848 to his death 1882, he presided over the council three times ....
in 1856 under the name Schweizerische Kreditanstalt (SKA, Swiss Credit Institution).
In 1942, it opened its first branch outside of Switzerland, in New York City.
In 1988, it gained a controlling stake in The First Boston Corporation and in 1993, Credit Suisse Group bought Schweizerische Volksbank (People's Bank of Switzerland). In 1996 the two retail banks were merged and renamed Credit Suisse.
In 2000, it acquired the investment bank Donaldson, Lufkin & Jenrette
Donaldson, Lufkin & Jenrette
Donaldson, Lufkin & Jenrette or DLJ is a defunct U.S. investment bank founded by William H. Donaldson, Richard Jenrette and Dan Lufkin in 1959. Its businesses included securities underwriting; sales and trading; investment and merchant banking; financial advisory services; investment research;...
(DLJ) and, with it, an e-commerce software portfolio, including DLJ Direct, that it later sold to the Bank of Montreal
Bank of Montreal
The Bank of Montreal , , or BMO Financial Group, is the fourth largest bank in Canada by deposits. The Bank of Montreal was founded on June 23, 1817 by John Richardson and eight merchants in a rented house in Montreal, Quebec. On May 19, 1817 the Articles of Association were adopted, making it...
.
In 2009, Credit Suisse was recognized as "Bank of the Year" by the International Financing Review.
In November 2011, CS announced to launch a new Algorithmic Index Platform to support the Quantitative Risk Management(QRM) to provide their clients a tailored solution to gain efficient exposure to a range of systematic equity investment strategies.
Credit Suisse is considered to be within the prestigious "bulge bracket
Bulge bracket
The bulge bracket comprises the "big banks," the world's largest and most profitable multi-national investment banks.- Technical meaning :The term 'bulge bracket' refers to the first group of investment banks listed on the "tombstone" notifying the public of a financial transaction or deal...
" of investment banks.
The firm earned accolades throughout the recent financial crises for prudent risk management and strategic allocation of capital. It is one of the few major international banks to weather the crisis without any direct government support.
- 1856 – Credit Suisse founded
- 1905 – First branch (in Basel)
- 1940 – First branch outside Switzerland (in New York)
- 1978 – Start of co-operation with The First Boston Corporation
- 1988 – Controlling stake in The First Boston Corporation, which is renamed CS First Boston
- 1989 – CS Holding became parent company of the Group
- 1990 – Acquisition of Bank Leu
- 1993 – Acquisition of Swiss Volksbank
- 1994 – Strategic alliance with Swiss Re
- 1995 – Strategic alliance with Winterthur Group
- 1996 – CS Holding becomes Credit Suisse Group; investment banking business named Credit Suisse First BostonCredit Suisse First BostonCredit Suisse First Boston was the former name of the banking firm Credit Suisse.-History:In 1978, Credit Suisse and First Boston Corporation formed a London-based 50-50 investment banking joint venture called the Financière Crédit Suisse-First Boston...
(CSFB) - 1997 – Merger with Winterthur Group
- 2000 – Acquisition of Donaldson, Lufkin & JenretteDonaldson, Lufkin & JenretteDonaldson, Lufkin & Jenrette or DLJ is a defunct U.S. investment bank founded by William H. Donaldson, Richard Jenrette and Dan Lufkin in 1959. Its businesses included securities underwriting; sales and trading; investment and merchant banking; financial advisory services; investment research;...
(DLJ) - 2001 – Sponsorship for the Sauber PetronasSauberSauber F1 Team is a Swiss Formula One team. It was founded in the 1970s by Peter Sauber, who progressed through hillclimbing and the World Sportscar Championship to reach Formula One in 1993....
Formula One Team - 2002 – Streamlining of the Group's organizational structure into two business units: Credit Suisse Financial Services and Credit Suisse First Boston
- 2004 – Focusing the Group's organizational structure on three business units:Credit Suisse, Credit Suisse First Boston and Winterthur
- 2006 – Credit Suisse undergoes a rebranding and structural shift to the "One Bank" model. It divests Winterthur to AXA and the newly reorganized Investment Bank replaces the old CSFB. The First Boston affiliation is retired.
- 2008 – Credit Suisse suspends some of its traders in connection with the overvaluation of assets by $2.85 billion. Credit Suisse writes down $2.85B
Mergers & Acquisitions
CSFB USA is a wholly owned subsidiary of Credit Suisse First Boston Inc., which is, in turn, a wholly owned subsidiary of CS. CS is a wholly owned subsidiary of CSG. CSFB USA was created through the merger with DLJ, which was completed on Nov. 3, 2000. CSFB LLC, CSFB's principalU.S. registered broker-dealer subsidiary, became a subsidiary of DLJ, and DLJ changed its name to CSFB USA.
Prior to the DLJ Merger, the Credit Suisse Group (CS) purchased First Boston in 1988 creating CS First Boston. The firm's bulge bracket status came after the merger with Donaldson, Lufkin & Jenrette
Donaldson, Lufkin & Jenrette
Donaldson, Lufkin & Jenrette or DLJ is a defunct U.S. investment bank founded by William H. Donaldson, Richard Jenrette and Dan Lufkin in 1959. Its businesses included securities underwriting; sales and trading; investment and merchant banking; financial advisory services; investment research;...
(DLJ).
Curtailments
July 2011, Credit Suisse cut 2,000 jobs from their worldwide staff of 50,700 employees in order to maximize cost efficiencies across the bank. This was in response to weaker than expected recovery in the US and Europe that had led them to hire too aggressively in the aftermath of the credit crisis in an effort to take market share from weakened rivals..
Structure
The bank is organized into three divisions, Investment BankingInvestment banking
An investment bank is a financial institution that assists individuals, corporations and governments in raising capital by underwriting and/or acting as the client's agent in the issuance of securities...
, Private Banking
Private banking
Private banking is banking, investment and other financial services provided by banks to private individuals investing sizable assets. The term "private" refers to the customer service being rendered on a more personal basis than in mass-market retail banking, usually via dedicated bank advisers...
, and Asset Management. Shared Services
Shared services
Shared services refers to the provision of a service by one part of an organization or group where that service had previously been found in more than one part of the organization or group. Thus the funding and resourcing of the service is shared and the providing department effectively becomes an...
, which includes functions such as IT, marketing and legal/compliance, encompasses all three major
Major
Major is a rank of commissioned officer, with corresponding ranks existing in almost every military in the world.When used unhyphenated, in conjunction with no other indicator of rank, the term refers to the rank just senior to that of an Army captain and just below the rank of lieutenant colonel. ...
areas. On January 16, 2006, Credit Suisse First Boston (CSFB), now the Investment Banking division, Credit Suisse Asset Management (CSAM), and Credit Suisse Private Banking (CSPB), re-branded themselves, becoming collectively known as Credit Suisse. This move was initiated to better leverage each others' resources and capabilities to create a "One Bank" brand and effort.
Credit Suisse
Alfred Escher
Alfred Escher was a Swiss politician and railway entrepreneur. A member of the Swiss National Council from 1848 to his death 1882, he presided over the council three times ....
.
- Private BankingPrivate bankingPrivate banking is banking, investment and other financial services provided by banks to private individuals investing sizable assets. The term "private" refers to the customer service being rendered on a more personal basis than in mass-market retail banking, usually via dedicated bank advisers...
– Credit Suisse is one of the world's largest private banking organizations with branches in Switzerland and numerous international markets. Private Banking specializes in providing personal investment counseling and professional asset management to affluent individuals.
- Corporate & Retail Banking – In Corporate & Retail Banking, Credit Suisse occupies a leading position in the Swiss market. It provides a wide range of banking services for private and corporate clients in Switzerland. In addition, it offers online banking services.
- Financial Institutions – Advice and solutionSolutionIn chemistry, a solution is a homogeneous mixture composed of only one phase. In such a mixture, a solute is dissolved in another substance, known as a solvent. The solvent does the dissolving.- Types of solutions :...
s for banks and financial institutions all around the world.
Credit Suisse, Investment Banking Division
This division used to be known as Credit Suisse First BostonCredit Suisse First Boston
Credit Suisse First Boston was the former name of the banking firm Credit Suisse.-History:In 1978, Credit Suisse and First Boston Corporation formed a London-based 50-50 investment banking joint venture called the Financière Crédit Suisse-First Boston...
. It is active in investment banking
Investment banking
An investment bank is a financial institution that assists individuals, corporations and governments in raising capital by underwriting and/or acting as the client's agent in the issuance of securities...
, capital markets and financial services. It is a member of the prestigious bulge bracket
Bulge bracket
The bulge bracket comprises the "big banks," the world's largest and most profitable multi-national investment banks.- Technical meaning :The term 'bulge bracket' refers to the first group of investment banks listed on the "tombstone" notifying the public of a financial transaction or deal...
of securities firms.
- Institutional Securities – Securities serves the broad needs of institutional clients with expertise in Equities, Fixed IncomeFixed incomeFixed income refers to any type of investment that is not equity, which obligates the borrower/issuer to make payments on a fixed schedule, even if the number of the payments may be variable....
, Prime Services and ResearchResearchResearch can be defined as the scientific search for knowledge, or as any systematic investigation, to establish novel facts, solve new or existing problems, prove new ideas, or develop new theories, usually using a scientific method...
. Investment BankingInvestment bankingAn investment bank is a financial institution that assists individuals, corporations and governments in raising capital by underwriting and/or acting as the client's agent in the issuance of securities...
serves corporate clients' needs through Mergers and AcquisitionsMergers and acquisitionsMergers and acquisitions refers to the aspect of corporate strategy, corporate finance and management dealing with the buying, selling, dividing and combining of different companies and similar entities that can help an enterprise grow rapidly in its sector or location of origin, or a new field or...
, Equity Capital Markets, Debt Capital Markets, Private Placements and Leveraged Finance services.
Credit Suisse Private Banking Division
Within the Private BankingPrivate banking
Private banking is banking, investment and other financial services provided by banks to private individuals investing sizable assets. The term "private" refers to the customer service being rendered on a more personal basis than in mass-market retail banking, usually via dedicated bank advisers...
sector Credit Suisse provides advice and investment products and services for high net worth individual
High net worth individual
A high-net-worth individual is a person with a high net worth. In the private banking business, these individuals typically are defined as having investable assets in excess of US$1 million. As explained below, the U.S...
s globally. Credit Suisse's structured advisory process encompasses both asset and liability management. Furthermore, Credit Suisse is a provider of alternative investment products. Wealth management solutions include tax planning; pension planning; life insurance solutions; wealth and inheritance advice, trusts and foundations. Credit Suisse offers multiple booking platforms and global execution capabilities. In Switzerland, Credit Suisse supplies banking products and services to private banking clients as well as to business and retail clients.
Until 2006 this division was known as Credit Suisse Private Banking or CSPB.
Asset Management
In its asset management business, Credit Suisse offers investments ranging from equities, fixed income and multiple-asset class products, to alternative investments such as real estate, hedge funds, insurance-linked securitiesInsurance-Linked Securities (ILS)
Insurance-linked securities are broadly defined as financial instruments whose values are driven by insurance loss events. Those such instruments that are linked to property losses due to natural catastrophes represent a unique asset class, the return from which is uncorrelated with that of the...
, private equity and volatility management. Credit Suisse's asset management business manages portfolios, mutual funds, and other investment vehicles for a broad spectrum of clients ranging from governments, institutions and corporations to private individuals. With offices in 23 countries, Credit Suisse's asset management business is operated as a globally integrated network. Credit Suisse uses the Credit Risk+ method under their financial products arm, to estimate the distribution and expected loss incurred by companies. They also help banks to calculate their capital reserves needed to buffer against credit/default risk.
Shared Services
In Shared Services, Credit Suisse provides services to support the divisions, while improving independent controls. The Shared Services divisions include CFO, COO, CRO, General Counsel, and IT division.Winterthur
Winterthur Group
AXA Winterthur is a multinational insurance company. The original company named Winterthur was founded in Winterthur, Switzerland, in 1875. Until June 2006, Winterthur was a Credit Suisse subsidiary. Now, Paris-based AXA Insurance has entered into a definitive agreement to purchase Winterthur...
was divested from Credit Suisse on June 14, 2006. AXA
AXA
AXA S.A. is a French global insurance group headquartered in the 8th arrondissement of Paris. AXA is a conglomerate of independently run businesses, operated according to the laws and regulations of many different countries. The AXA group of companies engage in life, health and other forms of...
acquired the leading Swiss insurance company from Credit Suisse Group for about €8 billion.
The CIO of Credit Suisse is Karl Landert, located in Zurich, Switzerland.
Sponsorship
Credit Suisse was one of Swiss F1 team SauberSauber
Sauber F1 Team is a Swiss Formula One team. It was founded in the 1970s by Peter Sauber, who progressed through hillclimbing and the World Sportscar Championship to reach Formula One in 1993....
's majority shareholder between 2001 and 2005 and then a sponsor between 2006 and 2009 when the team was known as BMW-Sauber.
Credit Suisse is sponsor of the Switzerland national football team
Switzerland national football team
The Swiss national football team is the national football team of Switzerland...
and Roger Federer
Roger Federer
Roger Federer is a Swiss professional tennis player who held the ATP no. 1 position for a record 237 consecutive weeks, and 285 weeks overall. As of 28 November 2011, he is ranked World No. 3 by the Association of Tennis Professionals . Federer has won a men's record 16 Grand Slam singles titles...
.
Criticisms
- In an article published by ReutersReutersReuters is a news agency headquartered in New York City. Until 2008 the Reuters news agency formed part of a British independent company, Reuters Group plc, which was also a provider of financial market data...
on February 23, 2008, Brazilian public prosecutor Karen Kahn announced that several employees of Credit Suisse as well as others from UBSUBS AGUBS AG is a Swiss global financial services company headquartered in Basel and Zürich, Switzerland, which provides investment banking, asset management, and wealth management services for private, corporate, and institutional clients worldwide, as well as retail clients in Switzerland...
, Clariden LeuBank LeuBank Leu AG was a Swiss private bank that existed from 1755 to 2007. Headquartered in Zurich, it was a subsidiary of Credit Suisse from 1990. In 2007, it was merged with that company's other private banking units as Clariden Leu. At the time, it was the oldest bank in Switzerland.The bank was...
and AIGAIGAIG is American International Group, a major American insurance corporation.AIG may also refer to:* And-inverter graph, a concept in computer theory* Answers in Genesis, a creationist organization in the U.S.* Arta Industrial Group in Iran...
were under investigation by federal authorities. In 2007, police arrested 20 people, including bankers at UBS, Credit Suisse unit Clariden and AIG Private Bank after the discovery of illegal activities including money laundering, tax evasion, fraudulent banking and operating without a banking license. During the course of Operation Switzerland in 2008, Christian Peter Weiss and 13 other employees of Credit Suisse were arrested in Rio de Janeiro for helping operate an illegal money transfer scheme.
- The New York Times reported on December 16, 2009, that Manhattan District Attorney Robert Morganthau, the Justice Department and Federal Reserve had reached an agreement with Credit Suisse in which Credit Suisse was fined $536 million. Credit Suisse settled on charges that it violated sanctions regulating financial transactions with Iran. The charges included "stripping", the practice of removing the identity and origin of funds used in transactions. Credit Suisse employees stripped the identities of Iranian banks enabling funds to be transferred to the Atomic Energy Organization of Iran and the Aerospace Industries Organization, entities respectively involved in the production of nuclear weapons and long range missiles. Credit Suisse advised Iranian banks such as Bank Melli and Bank Saderat on methods to hide their identities and send more than a billion dollars through New York banks.
- In 2009 a federal bankruptcy judge in Montana accused Credit Suisse of "naked greed" so overreaching as to "shock the conscious of the court." The judge was referring to an alleged "loan to own" scheme between Credit Suisse and Yellowstone ClubYellowstone ClubThe Yellowstone Club, also Yellowstone Ski Resort, is an invitation-only residential club, ski resort, and golf resort located in the state of Montana, USA. The Rocky Mountain ski and golf club is located in eastern Madison County, just west of Big Sky, Montana, south of Bozeman and northwest of...
founder Tim BlixsethTim BlixsethTimothy Lee "Tim" Blixseth is an American real estate developer, record producer, songwriter and timber baron who is best known for co-founding the Yellowstone Club in Montana. Raised in Roseburg, Oregon, Blixseth amassed a fortune in real estate and timber holdings and, in 2006, was featured in...
in which Credit Suisse lent the private ski and golf club $375 million, $210 million of which Blixseth took as a personal payment. This payment sparked a lawsuit by club investor Greg LeMondGreg LeMondGregory James LeMond is a former professional road bicycle racer from the United States and a three-time winner of the Tour de France. He was born in Lakewood, California and raised in Reno, Nevada....
, charges of tax evasion by state governments and eventually led to the Club's bankruptcy. The Yellowstone Club - Blixseth court findings opened the doors to other suits targeting Credit Suisse with predatory lending practices. Credit Suisse faces a class action lawsuit on behalf of more than 3,000 investors seeking $24 billion in claims for similar real estate deals in Idaho, Nevada, Montana and the Bahamas.
- In 2011 Credit Suisse, facing a U.S. Department of Justice probe, reportedly agreed to settle claims they aided clients evade U.S. taxes through secret accounts and other dealings to avoid a formal federal indictment. The agreement reports to include paying more than US$1 billion in fines and releasing details on U.S. account holders and related deals where the bank may have aided clients in evading U.S. taxes.
Lloyds Banking Group
Lloyds Banking Group
Lloyds Banking Group plc is a major British financial institution, formed through the acquisition of HBOS by Lloyds TSB in 2009. As at February 2010, HM Treasury held a 41% shareholding through UK Financial Investments Limited . The Group headquarters is located at 25 Gresham Street in London, with...
, Barclays, and several other banks were involved with similar information stripping scandals around the same time as Credit Suisse.
See also
- European Financial Services RoundtableEuropean Financial Services RoundtableThe European Financial Services Roundtable is a European organization, located in Brussels, Belgium, of financial service companies to provide a voice on policies of the European Union related to financial matters...
- Credit Suisse First BostonCredit Suisse First BostonCredit Suisse First Boston was the former name of the banking firm Credit Suisse.-History:In 1978, Credit Suisse and First Boston Corporation formed a London-based 50-50 investment banking joint venture called the Financière Crédit Suisse-First Boston...
- First Boston Corporation
- Donaldson, Lufkin & JenretteDonaldson, Lufkin & JenretteDonaldson, Lufkin & Jenrette or DLJ is a defunct U.S. investment bank founded by William H. Donaldson, Richard Jenrette and Dan Lufkin in 1959. Its businesses included securities underwriting; sales and trading; investment and merchant banking; financial advisory services; investment research;...
Main competitors
- Goldman Sachs Group
- J.P. Morgan Chase
- BNP ParibasBNP ParibasBNP Paribas S.A. is a global banking group, headquartered in Paris, with its second global headquarters in London. In October 2010 BNP Paribas was ranked by Bloomberg and Forbes as the largest bank and largest company in the world by assets with over $3.1 trillion. It was formed through the merger...
- HSBC Holdings
- Wells FargoWells FargoWells Fargo & Company is an American multinational diversified financial services company with operations around the world. Wells Fargo is the fourth largest bank in the U.S. by assets and the largest bank by market capitalization. Wells Fargo is the second largest bank in deposits, home...
- Barclays
- Morgan StanleyMorgan StanleyMorgan Stanley is a global financial services firm headquartered in New York City serving a diversified group of corporations, governments, financial institutions, and individuals. Morgan Stanley also operates in 36 countries around the world, with over 600 offices and a workforce of over 60,000....
- UBS AGUBS AGUBS AG is a Swiss global financial services company headquartered in Basel and Zürich, Switzerland, which provides investment banking, asset management, and wealth management services for private, corporate, and institutional clients worldwide, as well as retail clients in Switzerland...
Company data
- Yahoo! – Credit Suisse Group Company Profile
- Credit Suisse stock quote & chart at GstockGstockGStock is a distributed computing project formed in 2006 for stock market analysis. It is enabled by users that volunteer to download and run a software client and donate some idle capacity of their computer processing unit . The gathered computing power is used to search for an investment strategy...
- Automated Trader