Angry shareholders at Credit Suisse have given the embattled chairman and chief executive, Lukas Mühlemann, a tough time in Zurich.
At their annual meeting on Friday, they took Mühlemann and management to task, in particular for last year's fall in profit and for the high salaries paid out at the top.
Lawyer Hans-Jacob Heitz, who has championed the cause of small shareholders, told the meeting that all was not well within the CS group, despite management claims to the contrary.
Series of failures
He said there had been a whole series of failures, ranging from the poor figures at the investment bank Credit Suisse First Boston and the Winterthur Insurance company to the "flop" of the acquisition in the United States of brokerage firm Donaldson, Lufkin and Jenrette (DLJ), and the collapse of Enron.
Mühlemann admitted to the 2,700 shareholders present that CS's share performance had not been satisfactory and that the group had experienced problems. However, he said corrective measures had been taken and that the group was on course.
Commenting on the Enron collapse, Mühlemann defended the role of Credit Suisse First Boston, one of nine investment banks being investigated for allegedly helping the energy trading group to hide losses.
Responsible and appropriate behaviour
"Credit Suisse First Boston believes that, based on the information available to it at the time, it behaved responsibly and appropriately in the Enron [case]," he said.
Mühlemann also allayed fears that Credit Suisse would have to write down the value of DLJ under new accounting rules. The bank acquired DLJ at the height of the market in 2000.
"There is not, at present, any indication that we will have to record any valuation adjustments under the new regulations," he said.
During the marathon meeting, Mühlemann also explained why he had decided to step down as a director of the Banco General de Negocios in Argentina, now under investigation for illegal practices, including helping the flight of capital.
He said that he and the chairmen of JPMorganChase and Dresdner banks had traditionally sat on the bank's board since they held stakes in the BGN.
However, as minority shareholders they could exert only "limited" influence and immediately tendered their resignations when they lost confidence in BGN management because of "incidents" now under scrutiny.
BGN is being investigated by the Argentinian authorities amid allegations that it helped wealthy customers move money abroad after the government imposed a ban on bank withdrawals.
Higher profit for 2002
Mühlemann was upbeat about the outlook for the CS group, saying that he expected significantly higher profits in 2002, despite expectations that it would be a difficult year for financial institutions.
"Our strong market position in all areas of business and the successful implementation of measures to reduce costs ... will impact positively on our results."
Shareholders have been pressuring Mühlemann to drop either his chairman or chief executive position and are requesting an audit of his role in the collapse of the Swissair group, in which he was a long-standing director.
As expected, shareholders rejected by an 80 per cent majority a motion to separate the two functions of chairman and chief executive.
In March, Credit Suisse reported that profits last year plunged by 73 per cent to SFr1.6 billion ($1.02 billion), down from SFr5.8 billion the year before.