Swiss pressure rises on Credit Suisse boss Dougan after U.S. deal

Wed May 21, 2014 1:55pm EDT
 
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By Katharina Bart

ZURICH (Reuters) - Pressure on Credit Suisse CSGN.VX boss Brady Dougan to quit shows no signs of abating in Switzerland following this week's $2.5 billion settlement with the U.S. authorities over charges that it helped Americans evade taxes by hiding their assets in secret bank accounts.

The Swiss bank's board has backed the American chief executive over the deal, under which Credit Suisse pleaded guilty to criminal charges but held onto its New York licence and its legally protected client data.

However, that matters little in Switzerland, where banking privacy is embedded in its culture and identity and UBS UBSN.VX and Credit Suisse are seen as the twin pillars of a banking industry which accounts for 6 percent of the country's gross domestic product.

As a result, executives like Dougan, a 24-year veteran of Credit Suisse, and UBS boss Sergio Ermotti are subject to intense public scrutiny. More than 78 percent of newspaper Tages-Anzeiger's readers felt both Dougan and his boss, chairman Urs Rohner, should step down.

"Credit Suisse leadership has allotted itself lavish compensation year after year. If not because they are meant to take responsibility in a crisis, then why?" Swiss shareholder advisory group Actares said on Wednesday.

Dougan is receiving more stick in Switzerland than Rohner, in part because the American became the Swiss bank's face by testifying to an angry U.S. Senate subcommittee in February, but also because the CEO has been criticized for sticking with an investment banking strategy.

Dougan, an Illinois native and one of only three global bank CEOs still in their jobs following the financial crisis, had previously endeared himself to Switzerland in his seven years as CEO of Credit Suisse with a low-key and hard-working style.

An American investment banker who received an eye-watering 90 million Swiss franc ($100.90 million) payday five years ago, Dougan shuns overt displays of wealth, which plays well in Switzerland, where ostentation is frowned upon.   Continued...

 
The logo of Swiss bank Credit Suisse is seen on an office building in Zurich May 20, 2014. REUTERS/Arnd Wiegmann