(Bloomberg) -- Credit Suisse Group AG cut 10% of the staff at its asset management business this year as it seeks to turn around a unit that has been hit by fund implosions in the wake of the pandemic.
Switzerland's second largest lender, which oversees 438 billion Swiss francs ($494 billion) in assets at the fund business, made the reductions as it closed some investment vehicles and wrote down the value of others, Eric Varvel, head of Credit Suisse asset management, said at the bank's investor day.
Varvel said that the unit has had a difficult year, with setbacks including a scandal involving a large client and a $450 million impairment to its stake in York Capital Management this quarter. He's pledging to add 10 billion francs of net new assets in higher-fee alternatives and private markets offerings over the next two to three years while increasing sales to wealth-management clients.
The business has 1,100 employees, according to a presentation on Tuesday.
Last week, the lender announced that two reinsurers it had backed through the asset management unit would stop underwriting new business after investors decided to pull their money from the funds. The bank has also shuttered a quantitative strategy and took a 24 million-franc charge on seed capital for a U.S. real estate vehicle in the third quarter. In addition, a joint venture with the Qatar Investment Authority is closing two groups of funds and returning capital to investors.
Chief Financial Officer David Mathers said in October that the bank had begun to close down funds and dismiss employees at its alternative asset management business after several of the strategies struggled to perform in the volatility caused by the Covid-19 pandemic.
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