London(CNN) Credit Suisse on Tuesday acknowledged “material weakness” in its financial reporting as it scrapped bonuses for top executives in the wake of its worst annual performance since the global financial crisis.
The embattled Swiss bank also said that chairman Axel Lehmann had proposed to “voluntarily waive” a share award worth 1.5 million Swiss francs ($1.6 million) for the 2022/2023 financial year, given the firm’s “poor financial performance.”
Credit Suisse (CSGKF) said in its annual report that it had found “the group’s internal control over financial reporting was not effective” because it failed to adequately identify potential risks to financial statements.
The revelations come just days after the bank delayed the publication of the annual report after an eleventh-hour query from the US Securities and Exchange Commission over cash flow statements for 2019 and 2020.
The board concluded that “this material weakness could result in misstatements of account balances or disclosures that would result in a material misstatement to the annual financial statements of Credit Suisse,” it added. Credit Suisse said it was urgently developing a “remediation plan” to strengthen controls.
Credit Suisse’s stock was down 3.7% in morning trade. The bank’s share price fell to a new record low Monday, as the collapse of Silicon Valley Bank and Signature Bank scared investors and pummeled European banking stocks.
— This is a developing story and will be updated.