Former Credit Suisse executives can keep bonuses

A bonus limit or a ban on bonuses is not an issue for the government KEYSTONE/© KEYSTONE / MARTIAL TREZZINI

The former managers of the defunct major bank Credit Suisse will not be forced to repay their bonuses. Given the current legal situation, a clawback is unlikely to be successful, says the Swiss finance ministry.

Speakling to the Swiss News Agency Keystone-SDA, it confirmed a report in the SonntagsZeitung newspaper. The government came to this conclusion in its report on banking stability. In it, the finance ministry also announced that it had analysed the legal means available to retroactively prosecute those responsible for the mismanagement of a bank.

The government therefore now sees a need for action in the legal framework. “In particular, instruments are to be created that will allow bank managers in similar cases to be retroactively stripped of bonuses that have already been paid out. With the introduction of a senior manager regime, these should also be clearly identifiable,” the finance ministry wrote.

However, a bonus limit or a ban on bonuses is not an issue for the government, it announced last Wednesday. In its view, such an instrument would “not be expedient”. Studies had observed higher fixed salaries as a side effect, it said. However, according to the government, bonuses should be linked to criteria of long-term economic success and should also be subject to blocking periods.

In the 339-page report on banking stability published on Wednesday, the government concluded that “many of the measures already introduced nationally and internationally to increase financial stability have basically proved their worth”.

More powers for FINMA

However, it said the analysis also revealed gaps in the existing system and therefore a need for action to further develop and strengthen banking regulation. The government intends to address this with a package of 22 measures divided into three main thrusts: improving prevention, strengthening liquidity and expanding the range of crisis instruments.

Specifically, it proposed, for example, extended competences for the Swiss Financial Market Supervisory Authority (FINMA), such as clear responsibilities for managers. FINMA’s authority to impose fines is also being examined.

Translated from German by DeepL/ts

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