May 5, 2022 | Editor: Martin Wennerström
Credit Suisse sued over risk management failure
A U.S. pension fund is suing former and current Credit Suisse board members and executives, including former Chairman Urs Rohner, over risk management failures related to the collapse of Archegos Capital Management. The lawsuit alleges that the defendants failed to ensure proper risk control systems and processes at Credit Suisse’s prime brokerage unit. This failure allegedly contributed to the USD 5.5 billion loss that the Swiss bank suffered after Archegos’ highly leveraged stock bets imploded in 2021. The lawsuit seeks to claw back compensation from the 20 defendants, as well as a declaration that they breached their fiduciary obligations. Separately, around 60% of votes cast at the 2022 AGM rejected the proposal to shield directors and executives from legal action for FY2020. The FY2020 discharge vote, initially scheduled to take place last year, was delayed due to controversies stemming from the losses the bank suffered following the collapse of Archegos and supply chain finance company Greensill Capital.
Major shareholder pushes for HSBC Holdings break-up
HSBC Holdings' largest shareholder, China’s Ping An, has urged the UK-based bank’s board to spin off its Asian business and separately list it on the Hong Kong stock exchange. Ping An, which holds an 8.3% stake in HSBC, has argued that a separate Asian entity would be more profitable and would benefit from lower capital requirements. Additionally, the unit would be less bound to UK regulations. HSBC shares jumped 2.6% in Hong Kong and went up 0.6% on the London Stock Exchange on the news.
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Investor urges shareholders to oust JET’s CFO and board
Buffett builds 9.5% stake in Activision Blizzard
Warren Buffett has announced that Berkshire Hathaway has amassed a 9.5% stake in Activision Blizzard. The stake, worth around USD 6 billion, was mainly built after Microsoft announced plans to acquire the video game publisher. Activision Blizzard’s stock has been trading well below Microsoft’s proposed takeover price of USD 95 a share, closing at USD 78 on May 2. However, the transaction is pending regulatory approval. In March, the U.S. Federal Trade Commission asked the two companies to provide additional data related to the antitrust review of the deal. Activision Blizzard shareholders approved the USD 68.7 billion Microsoft merger in April 2022.
Governance in Brief – May 25, 2023
Activist investor pushes for leadership and strategy changes at NRG Energy Activist investor Elliott Investment Management has disclosed a 13% stake in the US-based NRG Energy and called for leadership and operational changes at the company to remedy its “meaningful underperformance.” The investor urged NRG to add independent directors with experience in the power and energy sector to its board, noting that it has already identified five executives to guide the operational and strategic changes.
Governance in Brief – May 19, 2023
EU court sides with Ryanair on Lufthansa’s 2020 bailout. The EU General Court, the second-highest court in the EU, has annulled the European Commission’s decision on the approval of state bailout for Deutsche Lufthansa prompted by the 2020 pandemic. The judgment found the EC erroneously considered that Lufthansa could not obtain financing on the markets and failed to ask for the implementation of an incentive mechanism for the airline to buy back the German Government’s stake.
Governance in Brief – May 11, 2023
JPMorgan Chase takes over failed First Republic Bank JPMorgan Chase has acquired the assets and deposits of First Republic Bank after California authorities seized and auctioned the troubled lender. The Federal Deposit Insurance Corporation (“FDIC”), an independent governmental agency established to maintain financial stability through the insurance of banks’ deposits, took possession of First Republic Bank after the lender suffered a severe liquidity crisis following the failure of SVB and Signature Bank earlier in March.
Governance in Brief – May 4, 2023
TotalEnergies sells Canadian oil sands operations to Suncor TotalEnergies has announced that it will sell its Canadian operations to Suncor Energy, in an agreement worth up to CAD 6.1 billion (USD 4.47 billion). The French energy giant had originally planned to exit Canadian oil sands by spinning off TotalEnergies EP Canada, but later agreed to instead sell the operations after having received unsolicited offers from both Suncor and other parties.