Register now for FREE unlimited access to Reuters.com Register

A logo is pictured on the Credit Suisse bank in Geneva, Switzerland, June 9, 2022. REUTERS/Denis Balibouse/File Photo

ZURICH, Sept 6 (Reuters) - Credit Suisse Group (CSGN.S) is selling its global trust business, an offshore arm for wealthy clients, as it embarks on an overhaul of its business following a series of scandals.

The sale was announced as the Swiss bank defended itself against a billion-dollar-plus damages claim involving its trust arm in Singapore.

Credit Suisse said it would sell its Singapore trust business, among others, and wind down legal entities and "residual businesses" in the coming years.

Credit Suisse has dubbed 2022 a "transition" year with a change of guard, restructuring to curtail risk-taking, while it faces speculation it could be bought or broken up.

Ulrich Koerner, 59, a restructuring expert, succeeded Thomas Gottstein as CEO in August after a tumultuous two years punctuated by huge losses, a rare court conviction for the bank in Switzerland and a 40% plunge in its shares.

This week, Georgia's former prime minister Bidzina Ivanishvili alleged in a Singapore court action that a trust unit of Credit Suisse had failed to take steps to prevent him from losing $1.27 billion.

Ivanishvili has accused Credit Suisse Trust in Singapore of failing to safeguard his investments and "take the appropriate steps" to prevent losses linked to fraud committed by its former Geneva-based banker Patrice Lescaudron.

The trust unit said the size of his claim was "extreme", asking the court to dismiss it.

Lescaudron was Credit Suisse's "conduit" for Ivanishvili's business and started "fraudulently mismanaging" the trust's investments and "misappropriating" the trust funds as early as 2007, Ivanishvili's barrister said.

Lescaudron was convicted by a Swiss court in 2018 of forging the signatures of former clients, including Ivanishvili, over an eight year period. Lescaudron subsequently took his own life.

Credit Suisse will sell the bulk of its trust business in Guernsey, Singapore and the Bahamas to the Bank of N.T. Butterfield & Son Limited (NTB.N), while Gasser Partner Trust will take over the Liechtenstein business.

Some entities will remain with Credit Suisse for a small number of clients. The bank declined further comment.

Reporting by Michael Shields; writing by John O'Donnell; Editing by Louise Heavens, Robert Birsel

Source: Reuters

Powered by NewsAPI.org