Credit Suisse fined £87m over crisis at Archegos

The Bank of England has fined Credit Suisse a record £87m over major failings that saw it lose billions when private investment firm Archegos Capital Management collapsed.

It was part of a global settlement – as the bank was also fined by the US Federal Reserve, taking the total penalty to around £300m.

Bank of England deputy governor Sam Woods said: ‘Credit Suisse’s failure to manage risks effectively were extremely serious.’ It ‘created a major threat to the safety and soundness’ of divisions that were at the heart of the episode, Woods said.

Credit Suisse lost £4.3bn when Archegos defaulted in 2021.

It was one of a succession of scandals that plagued the bank leading up to a mass exodus of depositors this year, which pushed it to the brink of collapse.

Credit Suisse is now a subsidiary of one-time Swiss rival UBS after an emergency takeover.

The collapse of Archegos, which invested the money of financier Bill Hwang, sent shock waves around the world. It used risky financial instruments to make big bets on a handful of stocks. When they started to fall Archegos was unable to meet obligations to lenders such as Credit Suisse.

The Prudential Regulation Authority levied the £87m fine.

It said risk management ‘fell well below the regulatory standards required’ and that the failings were ‘symptomatic of an unsound risk culture within the business that failed to balance considerations of risk against commercial reward appropriately’.