The Financial Conduct Authority (FCA) of the UK has reportedly put Swiss investment bank, Credit Suisse, on its watchlist of establishments that require stricter supervision, according to a report by the Financial Times, citing a letter sent two month ago.
The regulator stated that the reason behind the move was due to the concern that the bank had not done enough to improve its governance, risk controls, and culture.
According to a source familiar with the matter, Credit Suisse's addition to the watchlist, which consists of about 20 institutions out of the nearly 60,000 that the FCA monitors at any given time, means that the regulator has serious concerns.
Last year, the Swiss lender was fined nearly $475 million by the FCA and the U.S. Securities and Exchange Commission (SEC) for resolving the fraud and bribery charges pertaining to the $2 billion Mozambican corruption scandal.
The British regulator also asked the bank’s senior executives to provide evidence of the steps that will be taken up for improving accountability and preventing such instances of misconduct.
In its letter, the regulator has asked Credit Suisse to carry out reviews in the second half of this year to assess the effectiveness of its risk and audit committees, and its international board.
These requests for reviews were made following a consultation with the Swiss financial market watchdog, Finma.
in its letter, the FCA added, that it is also concerned about whether the bank has correctly reported the conduct rules that it had been breaching for many years.
Last year, Credit Suisse chalked up a Fr.1.6 billion ($1.62 billion) loss following the collapse of investment fund Archegos and the collapse of the massive $10 billion in supply chain finance funds (SCFFs) associated with the, now-insolvent financial services firm, Greensill Capital.
While the bank did not comment regarding the report by FT, it stated that as had been summarized previously, the institution has begun executing the plan for strengthening the business as well as its risk culture.