Credit Suisse's Chief Executive Officer Tidjane Thiam says the Swiss bank has been ''underweight'' in China and will look to build its wealth management capabilities in the world's second-biggest economy, despite slowing growth. But, as Julian Satterthwaite reports, the bank has plenty of challenges ahead.
How did he overlook a billion dollars... Credit Suisse chief executive Tidjane Thiam under growing pressure to explain the bank's surprise write-downs in the first quarter. The Swiss lender writing off trades in securitized products and distressed credit. Reuters financial services editor Rachel Armstrong says it's not the scale of the loss that has people worried: (SOUNDBITE) (English) REUTERS FINANCIAL SERVICES EDITOR, RACHEL ARMSTRONG, SAYING: "I think that why people have started to ask questions is that the chief executive of the bank said he wasn't aware of the scale of the risk until the middle of January, which has caused people to question its risk controls, its procedures, why isn't it that senior management were aware of this?" If Thiam wasn't aware of the troubled trades, analysts say the bank's chief financial officer and chief risk officer should have been. If they knew but didn't tell, that just raises other questions about internal communications. Doubts too about Thiam's ability to execute his own strategy: (SOUNDBITE) (English) REUTERS FINANCIAL SERVICES EDITOR, RACHEL ARMSTRONG, SAYING: "I think people now say that it's good, they've come out, they've been very transparent about what's gone on. I think the biggest issue is that the chief executive, Tidjane Thiam, he came in last June, he unveiled this big new strategy... I think to now have to take write-downs of this scale will make people a little nervous about how soon and how quickly and how well he can put that new strategy into practice." Thiam wants to pare back Credit Suisse's investment bank, and focus on wealth management. That's part of a sweeping revamp that has so far received a lukewarm response from analysts. Billion dollar bungles won't do anything to win over the critics.