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Credit Suisse loses bid to reject trial in the US over write-downs



(Reuters) – A US judge has rejected Credit Suisse Group AG's bid to reject a lawsuit accusing the Swiss bank of deceiving the shareholders about the risk appetite and risk management before taking $ 1 billion of write-downs on acid debt.

The decision of US district director Lorna Schofield in Manhattan was announced Wednesday.

Judge Schofield said that investors who lost money in Credit Suisse US depository receipts could claim that the bank, CEO Tidjane Thiam and other defendants would mislead them, by Credit Suisse taking two write-downs in early 2016 of $ 4.3 billion of secured loan commitments and unpleasant debt, which contributed to its first full-year loss since the global financial crisis in 2008.

The bank's share price fell 1

1% after news of the first write-down. Others accused were CFO David Mathers and Thiam's predecessor, Brady Dougan.

Credit Suisse had no immediate comment. An attorney for the defendants did not immediately respond to the request for comment.

Leading plaintiffs are four retirement and retirement plans in the suburbs of New York City and Chicago, and in Birmingham, Alabama. Their lawyers did not immediately respond to the request for comment.

Since Thiam became CEO in 2015, Thiam has moved Credit Suisse to a bank for ultrasound and entrepreneurial clients while lowering his investment bank.

Although Judge Schofield was dismissed Some claims in the lawsuit referred to Thiam's own statements about the bank's rising risk appetite to explain why the case would proceed.

"Thiam himself stated that constantly raising the internal risk classes led to larger exposures to illiquid CLO and concerned debt investments and resulted in the write-downs," writes Schofield. "Thiam made a statement to the Wall Street Journal," A border that is moving is not a border. ""

Judge Schofield said that statements such as these could indicate that investors "lulled in believing that the levels of risk were content and acceptable." and that previous courts had not held any responsibility for similar actions by other banks and business executives.

The case is City of Birmingham Firefighters and Police Supplemental Pension System v Credit Suisse Group AG et al. US District Court, Southern District of New York, No. 17-10014.


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