Credit Suisse Group AG’s top executive said he’s not concerned about potential conflicts of interest in the bank’s dealings with Michael Klein, the former board member who is slated to sell his advisory boutique to the Swiss lender.
(Bloomberg) — Credit Suisse Group AG’s top executive said he’s not concerned about potential conflicts of interest in the bank’s dealings with Michael Klein, the former board member who is slated to sell his advisory boutique to the Swiss lender.
“I have zero concerns,” Ulrich Koerner, the chief executive officer of Credit Suisse, said in an interview with CNBC when asked about potential conflicts of interest. “We can deal with a situation like that in the utmost professional way,” he said, adding that Klein is an “excellent banker and dealmaker.”
Klein, who founded M. Klein & Co. and sat on Credit Suisse’s board of directors until recently, is expected to fold his business into the investment bank that the Swiss lender plans to spin out under the storied First Boston name. The two sides are close to an agreement that would value Klein’s firm at a few hundred million dollars, after initially clashing over the price, Bloomberg has reported.
But Klein’s role on the Swiss bank’s board, and on the committee that decided to carve out CS First Boston, has raised concerns of potential conflicts of interest. Credit Suisse’s chairman has said Klein abstained from some votes on the topic. In its negotiations with the veteran dealmaker, the Swiss lender engaged Deutsche Bank AG to provide a fairness opinion, people familiar with the matter have said.
Klein had stepped down from the board to become CEO designate of the new CS First Boston business as part of the bank’s strategic revamp in October. But there remained the hurdle that he had his own advisory firm, which prompted the move by Credit Suisse to buy it in order to bring him on board.
“I’m really looking forward to Michael joining,” Koerner told CNBC at the World Economic Forum in Davos. “He is an excellent banker and deal-maker, and he is very entrepreneurial. And that’s why I want to go together with him on this journey.”
Koerner also addressed a Financial Times report that the lender was planning to cut more than 10% of its European investment bankers this year, saying those reductions were part of the 9,000 roles he plans to shed globally by 2025.
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