Black clouds once again hang over the Swiss banking giant Credit Suisse. The lender's shares dropped after the postponement of the annual report following the US Securities and Exchange Commission (SEC Securities and Exchange Commission (SEC) The Securities and Exchange Commission (SEC) is one of the most widely known independent authorities in the United States. The SEC has a wide range of responsibilities, helping police markets and curbing against abuse. This includes enforcing federal securities laws, proposing securities rules, and regulating the US’ stock and options exchanges.As one of the paramount regulatory authorities in the US, the SEC is responsible for the oversight of public companies in the aforementioned segments.Wha The Securities and Exchange Commission (SEC) is one of the most widely known independent authorities in the United States. The SEC has a wide range of responsibilities, helping police markets and curbing against abuse. This includes enforcing federal securities laws, proposing securities rules, and regulating the US’ stock and options exchanges.As one of the paramount regulatory authorities in the US, the SEC is responsible for the oversight of public companies in the aforementioned segments.Wha Read this Term) call, and the investment banking team in Japan was significantly reduced.

Credit Suisse Gets a Call from SEC

According to media reports, Credit Suisse had to delay the publication of its annual report after receiving a subpoena from the SEC the previous evening regarding cash flow statements dating back three years.

Without giving any additional details, the bank stated that the SEC's feedback was technical and had no impact on its financial statements for 2022, which were released last month.

However, shares of the lending giant received the news rather pessimistically and were down more than 5% to $2.75 before the main session on Wall Street started. Credit Suisse's stock has fallen 70% in the past year in response to unfavorable market conditions, declining bank revenues and several controversies that resulted in a significant outflow of client assets under the institution's management.

Additionally, negative news came from Japan where Credit Suisse was to cut most of its investment banking team of more than 20 people. The Reuters news agency reported the information on Thursday, which cited three people familiar with the matter.

Credit Suisse's investment banking division, which houses capital markets and M&A advisory businesses, has undertaken two-phase restructuring in Japan, nearly halving the number of its bankers in November and then shedding all but a few in January.

Refinitiv's data compilation shows that in 2021 Credit Suisse secured the eleventh rank in Japan's investment banking league. However, the bank dropped out of the top 20 in 2022.

Strategic Overhaul in Credit Suisse

The list of problems facing Credit Suisse is very long. When the lender published its quarterly report in October 2022 showing a $4 billion loss in three months, the bank saw the need for radical restructuring. As part of this, it planned to raise $4 billion in additional funding and lay off up to 9,000 employees.

News of the headcount reduction first emerged in mid-January, with job cuts of around 10% in the European investment banking business. Previously, the financially troubled entity allegedly made hundreds of job cuts already in December, primarily at its London and Zurich offices.

The controversy surrounding Credit Suisse's operations and the multi-million dollar fines it paid in 2022 caused a total of CHF 110.5 billion to leave the lender's accounts. Total assets under management amounted to CHF 1.3 trillion at the end of the year, falling 20% from a year earlier.

At the beginning of February, investors saw an accurate picture of Credit Suisse's condition when the institution published its annual report and reported that the loss in 2022 amounted to CHF 7.3 billion, compared to the CHF 6.53 billion forecasts by analysts.

According to the Swiss Financial Market Supervisory Authority (FINMA), Credit Suisse is currently facing enforcement proceedings over its business ties with financier Lex Greensill and his firms. The regulator alleges that the bank has "seriously breached" its supervisory obligations.

FINMA has imposed remedial actions on Credit Suisse to address the breach of its supervisory obligations Obligations In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you Read this Term. These measures include executive-level reviews of the bank's 500 most significant business relationships, specifically on counterparty risks conducted periodically.