Credit Suisse to Compensate Clients Over Lehman Structured Product Losses

Stephen Harris

29 September 2008

Credit Suisse says that it has been in intensive discussions with many clients who have been directly affected by the bankruptcy of Lehman Brothers.

The Swiss bank says that although investors are solely responsible for the issuer risk of structured products, it has decided – with no acknowledgement of any legal obligation on its part – to accommodate those private clients who, as of 31 August 2008, had assets of up to SFr500,000 at Credit Suisse and had invested more than 50 per cent of these total assets in capital-protected Lehman products.

The plan applies to all clients, not just those based in Switzerland. It will, however, only apply to a few clients outside the country.

Credit Suisse says it will shortly submit a fair proposal to resolve the matter for these private clients. The bank will also offer support to all clients who fall outside the criteria in matters relating to the bankruptcy and protection of creditor proceedings of Lehman Brothers, and, as far as possible, also represent them in these proceedings.

Individual client requests will be reviewed by a project group that will determine the amount that Credit Suisse will offer.