Former Credit Suisse Executives Settle Lawsuit for $115 Million

Former Credit Suisse executives and directors, including former chairman Urs Rohner, agreed to pay $115 million to settle a suit filed by shareholders who claim they failed to maintain adequate risk management, resulting in losses between 2020 and 2021. The settlement will be paid to UBS Group AG, funded by the insurers of the directors and officers. The shareholders claimed the risk management failures led to losses due to defaults by Malachite Capital Management, Greensill Capital Management, and Archegos Capital Management.

Former executives and directors of Credit Suisse Group AG, including former chairman Urs Rohner, have agreed to pay $115 million to settle a lawsuit filed by shareholders who claim they failed to maintain adequate risk management, resulting in significant losses between 2020 and 2021 [1]. The settlement, preliminarily approved by a New York judge on August 29, 2025, will be paid to UBS Group AG, the successor to Credit Suisse, and will be funded by the insurers of the directors and officers [1].

The shareholders, led by the Employees Retirement System for the City of Providence, alleged that the risk management failures led to substantial losses when multiple counterparties defaulted, including Malachite Capital Management, Greensill Capital Management, and Archegos Capital Management [1]. UBS Group AG has announced a notice of pendency and proposed settlement involving all persons or entities who held shares of UBS Group AG (Credit Suisse) common stock as of the close of business on August 22, 2025 [2].

Under the terms of the proposed settlement, UBS Group AG will receive $115 million, which will be used to offset losses incurred due to the defaults of the mentioned counterparties [2]. The settlement is subject to the approval of the court, and a hearing is scheduled for October 17, 2025, to determine whether the settlement is fair, reasonable, and adequate for the company and its stockholders [2].

The settlement hearing will provide an opportunity for stockholders to object to the proposed settlement or the fee and expense application. However, it is important to note that individual stockholders will not receive any direct payment from the settlement, as the cash recovery will go to UBS Group AG as the successor to Credit Suisse [2].

This settlement marks a significant milestone in the ongoing legal battle between Credit Suisse's shareholders and its former executives, highlighting the importance of robust risk management practices in the financial industry.

References:
[1] https://www.bloomberg.com/news/articles/2025-08-29/ex-credit-suisse-executives-settle-risk-suit-for-115-million
[2] https://www.morningstar.com/news/pr-newswire/20250829la60487/ubs-group-ag-announces-notice-of-pendency-and-proposed-settlement-involving-all-persons-or-entities-who-held-shares-of-ubs-group-ag-credit-suisse-common-stock-as-of-close-of-business-on-august-22-2025