Credit Suisse recently saw its stock drop to a record-low price level.
The bank reported Tuesday that “certain material weaknesses in our internal controls over financial reporting” had been detected, leading management to describe those controls as “not effective” for 2021 and 2022.
The original publication date for the 2022 annual report in which it made that disclosure had previously been pushed back from the prior week.
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The disclosure was made before the dip to the record low Tuesday, with shares for the bank subsequently being priced around $2.50 by the afternoon.
The “failure to design and maintain an effective risk assessment process to identify and analyze the risk of material misstatements in its financial statements and the failure to design and maintain” certain “effective monitoring activities” were what the company said the weaknesses pertained to.
The matter will be addressed as part of a plan the bank is working on, according to the annual report.
The latest annual report “fairly present[s], in all material respects, our consolidated financial condition” for those two years and the bank’s consolidated operations and cash flow results for the past three years, Credit Suisse said.
The pushback of the annual report’s release was due to a “late call” over “certain open SEC [Securities and Exchange Commission] comments about the technical assessment of previously disclosed revisions” to 2020 and 2019 cash flow statements “as well as related controls” that the SEC placed on the company March 8, according to Credit Suisse.
The bank tweeted Tuesday that it wanted to “reiterate, as announced this morning, our financial results for 2022 and preceding years are accurate and reliable.” That, it said, was “supported by a clean audit opinion” by external auditor PwC.
Investor Robert Kiyosaki predicted on “Cavuto: Coast to Coast” Monday that Credit Suisse was “the next bank to go … because the bond market is crashing.” He also noted he “called Lehman Brothers years ago.”
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His comments came after Silicon Valley Bank and, later, Signature Bank were shut down, moves that created turbulence in the stock market in recent days.
For 2022, Credit Suisse posted net revenues of 14.92 billion Swiss francs, a 34% year-over-year decrease. Its net loss, meanwhile, widened from 1.65 billion Swiss francs to 7.29 billion, according to the bank’s annual report.
The bank announced in October it would be reducing its workforce by 5% in the fourth quarter and planned to trim its headcount even more by 2025.
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