Credit Suisse, the 164-year-old Zurich-based Swiss investment banking company, said later this week that the multinational financial services provider having had a revenue of 22.48 billion Swiss Franc would round off its fiscal fourth quarter of the year deep in the reds as the Swiss lender had been forced to set aside a whopping upsum of $850 million on Friday due to a decade-old legal dispute on property debt in the US, unveiling a last-ditch attempt to open 2021 with a clean-slate.
In point of fact, latest remark from Credit Suisse officials came forth weeks after the Swiss lender’s Chief Executive Thomas Gottstein was quoted saying in a statement that he had been on the lookout to start off the new year with a “clean slate” regarding legal issues and had set aside a stark upsum of $850 million in order to apprehend legal disputes which were rooted back in the era of Great Financial Depression of 2007-09.
On top of that, the Zurich-based lender had already sidestepped as much as $300 million to address the decade-long legal dispute with a New York-based municipal bond insurer MBIA which had sued Credit Suisse back in the 2009s claiming liabilities on warranties for failed mortgage payments since it had laid off hundreds of millions of dollars in compensation regarding a US residential mortgage-backed security (RMBS) in 2008.
Credit Suisse faces off hundreds of millions in US mortgage insurance lawsuit
Aside from that, after more than a decade-long legal dispute, the New York Supreme Court Judge Jennifer Schecter had ruled back in November last year that the Swiss lender had failed to uphold its warranties to MBIA, which had insured investors in residential mortgage backed securities before the Great Financial Depression in 2008, while Credit Suisse had said in a statement in December that the Swiss lender was expected to lay off hundreds of millions of dollars more under the financial terms of a decipherable compensation deal with MBIA, $680 million to be precise.
Concomitantly, mirroring a substantial legal triumph for MBIA, the ruling stated, “This case involves mortgage loans that contributed to a crippling financial crisis over a decade ago after banks securitised residential mortgages that never should have been issued in the first place,” adding that Credit Suisse must pay damages for warranties that it had issued for MBIA.