Meltdown Greed, scandal, and the collapse of Credit Suisse

Money doesn't get any dirtier or dumber than in this mordant history of Credit Suisse. Bloomberg News journalist Mavin (Pyramid of Lies) recaps a litany of scandals at the giant Swiss bank, stretching back to WWII, when the bank helped Nazi Germany turn looted art and gold into international bank deposits. Subsequent misdeeds included covert banking on behalf of rogue states like Libya and Iran, enabling wealthy American clients to evade taxes, selling "crap" mortgage-backed securities that contributed to the 2008 financial crisis, and tailing and spying on its own discontented executive. But Credit Suisse's 2023 collapse, Mavin contends, was due less to scandal than stupid investments--like into the shady asset management firm Archegos Capital, whose failure cost the bank $5.5 billion. Mavin paints the Credit Suisse culture as an ungainly mix of Swiss stolidity and American-style risk-taking--inherited from its 1988 merger with investment bank First Boston--overlaid with cut-throat office politics that kept upper management in turmoil. (The bank fired its co-CEO John Mack, who ran its Manhattan office, without warning after secretly setting up a duplicate Manhattan office that he knew nothing about.) The firm thus let its bankers undertake all manner of reckless and fraudulent dealings, then dithered unimaginatively during crises, "like a runaway train without a driver." This lucid, tart, and entertaining account offers a window into the grubby chicanery and boneheaded bets that plague high finance. (Mar.)

A top business reporter unravels the failure of Credit Suisse. When the once-mighty topple with a thundering crash, there are inevitably questions about how it happened. In the case of the fall of Credit Suisse, Mavin, a respected financial journalist, pulls together evidence from official documents, media reports, and personal interviews to piece together the story. He traces many of the problems to Credit Suisse's 1988 decision to move into the U.S. through the acquisition of investment bank First Boston. But the American banking market is far different from the starchy, conservative Swiss culture. In the early years, a lot of money came in, but Credit Suisse was working in a high-risk business without proper mechanisms for risk evaluation and mitigation. Even more, the move triggered a period of overexpansion and dubious deals, including tawdry secret transfers of funds for dictators and criminal kingpins. This led to a string of scandals. "From 2010 onwards, the bank paid fines of more than $15 billion in relation to misconduct by its own employees," Mavin writes. As operational losses due to bad investments mounted, there was a large turnover of senior executives. In one seven-year period, the bank churned through four CEOs. All this led to a collapse of reputational trust, and in 2023 Swiss regulators declared the bank unviable. A takeover by long-standing rival UBS was hurriedly put together. "Credit Suisse usually had plenty of capital," Mavin writes, "but, in the end, it ran out of trust." A remarkable account of a complex story. Copyright (c) Kirkus Reviews, used with permission.