Mark Branson, chief executive of Swiss financial watchdog FINMA, says that the board of the scandal-hit Raiffeisen bank should have controlled its CEO more.
He made his comments in an interview to the NZZ am Sonntagexternal link newspaper. They follow on from Thursday’s FINMA report into the Swiss bank, which identified “serious shortcomings” in governance. FINMA had launched a probe related to fraud allegations against former bank Chief Executive Pierin Vincenz, who denies any wrongdoing.
“Controlling the management is a key duty of the administrative board. It was too lax in this duty,” Branson said.
Vincenz’ personal involvement in certain transactions was very controversial. “That the CEO was not obliged step back [from the transactions], shows that the administrative board did not have him in check,” Branson continued.
In an interview with the SonntagsZeitungexternal link, the vice-chairman of the Raiffeisenexternal link board, Pascal Gantenbein, said that the FINMA report’s tone had been sharper than expected. “I think FINMA wanted to make it very clear that enforcement procedures are very important. The scale of the problems, on the other hand, did not surprise me.”
Meanwhile, two further board members have stepped downexternal link with immediate effect following criticism at the bank’s delegates assembly in Lugano on Saturday. Two members of the board have already announced their departures and another will go in autumn. The chairman of the board left in March.
Prosecutors are investigating Vincenz, who has been forced to resign from business roles, on suspicion of breach of trust linked to cashless payments business Aduno as well as private equity firm Investnet. Vincenz was released from investigative custody on Tuesday after being held for three months.
Raiffeisen, for its part, has taken a series of measures in the past two years in a bid to resolve the situation.
The bank is Switzerland’s third largest and is owned cooperatively by 1.9 million customers.
SDA-ATS/NZZ am Sonntag/SonntagsZeitung/Reuters/ilj