Credit Suisse CEO Tidjane Thiam Calls for Investor Calm

ZURICH—Top executives at Credit Suisse Group AG asked shareholders on Friday to be patient with the Swiss bank's turnaround efforts and depressed stock price.

Addressing investors at Credit Suisse's annual meeting, Chief Executive Tidjane Thiam said that, "the development of our company's share price in recent months has been disappointing for you as shareholders, for everyone at Credit Suisse and for me personally."

Some weren't placated. Credit Suisse "reminds me of an office building that seems to be collapsing," said the first shareholder to speak following Mr. Thiam's remarks. "We shareholders are the suffering owner of the building."

The bank's shares have lost more than 40% of their value since Mr. Thiam took over last July. The stock fell 4% on Friday, as the bank hosted its five-hour-long meeting in a suburb of Zurich.

The bank said 18% of shareholders voted against short-term bonuses awarded to Credit Suisse executives for 2015, and nearly 15% voted against the executives' fixed pay amounts.

Mr. Thiam is attempting a broad shift in strategy that involves paring back Credit Suisse's investment bank, and focusing more on wealth-management businesses.

The CEO noted particular difficulties encountered late last year, which contributed to the bank's pretax loss of 2.4 billion Swiss francs ($2.5 billion) for all of 2015. Mr. Thiam also noted plans unveiled last month for deeper cuts than originally envisioned at Credit Suisse's investment bank, which had generated nearly $1 billion in losses late last year and early this year that blindsided investors and analysts.

The Wall Street Journal reported Thursday on internal confusion at Credit Suisse during a critical period late last year, as supervision of the investment bank business generating the losses was being transferred to new management. Past and present heads of the business have given differing accounts of who was in charge of what, and when.

"There will always be people who question or criticize a chosen path, a strategy or the implementation of plans," Credit Suisse Chairman Urs Rohner said at Friday's meeting. He added: "We welcome this dialogue."

Thomas Minder, a shareholder and member of parliament who spearheaded legislation granting Swiss investors a direct say on executive pay levels, told Mr. Rohner that "we are horrified" by corporate governance at the bank. "Are you aware that your current compensation system calls for further regulation?" he asked. In particular, Mr. Minder criticized a replacement award given to Mr. Thiam, valued at nearly 10 million francs as of last month and meant to compensate him for pay left behind at his former employer, U.K. insurer Prudential PLC.

Mr. Rohner defended Mr. Thiam, calling him "the ideal CEO" to lead the bank through its restructuring. The bank's senior management will "not allow our confidence to be undermined by short-term events," the chairman said.

Mr. Thiam had limited banking experience before he was hired last year to lead 160-year-old Credit Suisse through what promised to be a trying period.

Many analysts and investors have viewed deep cuts to Credit Suisse's investment bank as long overdue. Increasingly stringent capital rules and challenging markets have made the relatively volatile business less attractive in recent years.

However, Mr. Thiam's predecessor, Brady Dougan, limited his investment bank reductions to more peripheral cuts. A shareholder at Friday's meeting inquired about clawing back compensation for Mr. Dougan, but was told the bank has no plans to do so.

Write to John Letzing at [e-mail]

(END) Dow Jones Newswires

April 29, 2016 10:35 ET (14:35 GMT)

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