Responding to reports that Credit Suisse had asked investors to destroy documents relating to loans of yachts and private jets to its wealthy oligarch clientele, the bank issued a statement on Thursday saying its actions were in line with its agreement. of non-disclosure.
Last week, investors received letters from the bank saying they are “destroying and permanently erasing” all information relating to certain securities transactions.
“Securitization” is the term used to describe the pooling of various financial debt securities, such as mortgages and credit card debt, which generate cash flows as the debts are paid off. Financial institutions can sell ownership of these cash flows to third-party investors as a new type of “securities,” a term once used for more traditional products such as stocks and bonds.
Credit Suisse had closed this particular securities portfolio at the end of last year. The revenue stream had been generated by loans of yachts and private jets worth an estimated US$2 billion on assets belonging to wealthy banking clients, including oligarchs who were sanctioned.
In its statement, Credit Suisse said the documents “contained portfolio statistics and performance modeling figures” and that “no data, client-related or otherwise, was erased.”
Moreover, they indicated that the portfolio investors had never had access to their clients’ data.
Credit Suisse maintained that it was fully entitled to “request non-participating investors to destroy documents” related to the transaction, “as is market practice, stipulated in the non-disclosure agreement”.
“Reminding parties to destroy confidential information is good data management and data hygiene,” the bank said.
Credit Suisse also said its actions were “in no way related to the recent implementation of additional sanctions,” which it claimed to fully comply with.
Russia’s recent large-scale invasion of Ukraine has drawn international ire and with it a plethora of economic sanctions against its businesses, financial institutions, currency and wealthy oligarchs.
However, Credit Suisse said the securities portfolio, as well as its stipulations to its investors that they destroy confidential data, were “absolutely unrelated to the ongoing conflict in Eastern Europe”.