Credit Suisse traders hid losses from risky trades; CEO admits loss could be higher than anticipated and announces another 2,000 job losses

The world’s fourteenth largest interbank FX dealer by market share, Credit Suisse, has announced a further 2,000 job losses, which will be made within the company’s markets division.

These redundancies are in addition to the previous 4,000 proposed redundancies that were announced at the beginning of this year by Credit Suisse CEO Tidjane Thiam.

According to Mr. Thiam, as a result of the insecurity of employment that has been experienced by many traders at Credit Suisse, some employees concealed trades that were more risk-orientated from senior management in the advent of a cost-cutting iniitative by the bank in October last year.

In 2015, Credit Suisse made its first annual loss in 8 years, the first since pre-financial crisis Europe. In January, the company announced the impending redundancy of 1,800 staff as part of a $627 million cost cutting exercise in London, followed by a further 4,000 cuts following the announcement of its annual loss.

In February, Credit Suisse cut bonuses for executives by 36%, and Mr. Thiam himself stated that he would take a substantial cut to his own bonus.

The admission by Mr. Thiam that the results of certain trades had been concealed from senior management by certain employees means that the investment loss sustained by Credit Suisse could well be more than it had anticipated and reported.

Mr. Thiam actually stated to Bloomberg:

“This wasn’t clear to me, it wasn’t clear to my chief financial officer, it wasn’t clear to many people inside the bank. That’s why I said there needs to be a cultural change, because it’s completely unacceptable. A lot of the problems in the investment bank are that people have been trying to generate revenue at all costs. There was no transparency.”