Terribly awkward timing for Credit Suisse, with Tuesday marking the opening day of its 26th Asian Investment Conference at the Conrad Hotel in Hong Kong.
A flagship event on the bank’s calendar, this year would have marked its triumphant return to an in-person setting since the Covid-19 pandemic.
Instead, it’s proceeding in the shadow of a weekend rescue and a hastily-arranged marriage with UBS.
Slight revisions to the programming will mean no sight of Credit Suisse chair Axel Lehmann or CEO Ulrich Koerner for the welcome address, as intended, given they’ll be on another continent – in Koerner’s case he’ll be fighting to keep his job.
Officials said on Monday the conference would definitely proceed as planned, albeit with the media no longer invited to attend. “The event will now be exclusive to clients and no longer open to media,” the bank’s officials wrote. That’s depressingly consistent with the world’s perception of Hong Kong at the moment; so much for documenting its revival, eh?
Regardless of the turmoil, Fortescue chairman Andrew Forrest is still a lock for his keynote on Tuesday (“Renewables – the pain and the gain”) to be hosted by Credit Suisse’s Australian-based Shane Galligan, banker to the billionaires.
No doubt it’s another opportunity for Twiggy to promote the gains without mentioning the pain; let’s not forget that Credit Suisse also organised a $2.5bn high-yield bond issue for Fortescue back in 2015 alongside JPMorgan (pulled due to weak investor sentiment, but still). Sounds like he’s turning up because he owes them a favour, but that’s not the explanation received from Fortescue.
“On the day the IPCC releases its final synthesis report, this is an important forum to speak with global investors about the role they can play in combating climate change and the ongoing use of fossil fuels,” a spokeswoman said.
Strike Energy CEO Stuart Nicholls and Woodside CFO Graham Tiver are due to speak on a gas panel with Saul Kavonic, Credit Suisse’s Australian head of integrated energy and resource securities. That’s on Wednesday, with Nicholls confirming his attendance, but no word back from Tiver’s people.
The cover-up
Meanwhile, Credit Suisse employees turning up to their Sydney office at the Gateway Building learned that they were now working for UBS.
One mischievous character stuck a post-it note over the Credit Suisse nameplate on Level 30. That was duly photographed and disseminated, soon finding its way to Margin Call, naturally. No doubt it was promptly removed, but at least someone’s maintaining a sense of humour.
Sorry times
It’s unlikely to be the only apology. Robert Drysdale, Sydney-based director at Fixed Income Solutions – a division of brokerage firm BGC Partners – wrote a solemn missive to investors on Monday morning reporting on the fallout of the Credit Suisse takeover.
Sounds like a number of clients were put into Additional Tier 1 bonds, making them the biggest losers out of the crisis. The AT1s – a bond-stock hybrid – have been nuked to a value of zero on the orders of the Swiss regulator. Shareholders, meanwhile, will receive three billion francs.
“The deal is essentially done,” Drysdale wrote. “It is a very bad outcome, and I am sorry. The bad ones hurt so much. There will be talk of legal challenges but with the regulator and government on board this is over in my view.”
Dark times, indeed. “I will call all Credit Suisse holders today,” he said. “I’m sorry.”
Bid for freedom
The Institute of Public Affairs is once again posing the question of why our barbaric society continues to imprison white-collar criminals. Doing so is expensive, has little deterrent value, and is a “disproportionate response” to corporate wrongdoing, the IPA says.
Those arguments are contained in the Institute’s submission to a Senate inquiry into the corporate regulator’s investigation and enforcement activities.
Instead of jail, the IPA’s authors – Professor Mirko Bagaric, of Swinburne Law School, and Morgan Begg, an IPA director of research – suggest perps be made to pay through financial restitution. There’s a technical term for this type of punishment: it’s called a slap on the wrist.
Not that any of these points are necessarily fresh.
In 2016 the IPA made a very similar argument in aid of Oliver Curtis, the husband of publicist Roxy Jacenko, to stop him from doing a bid over his insider trading. Curtis ended up spending a year inside. When he walked out it was certainly in style – a luxury SUV was idling beyond the gates of Cooma Correctional Centre and a private jet was waiting at the airport.
As Bagaric and Begg tell it to the Senate, imprisoning corporate offenders costs society “nearly $150,000 per year” yet they present “no risk to our safety and are normally productive members of the community”.
Moreover, they cause “no harm to any individual”, their crimes are “often no more serious than government waste”, and they suffer “collateral harm through reputational damage”.
That’s rich. Did someone on trial help write this submission? Relax, we’re kidding.
South32’s succession confusion continues
A year ago South32 was interviewing candidates to take on the chief executive’s role, but there’s still no sign of Graham Kerr leaving the miner’s C-Suite.
Court sends Clive back to his swamp
Clive Palmer’s interminable efforts to get clear of prosecution over alleged breaches of the takeovers code were unceremoniously swatted aside by the Federal Court.