DealBook: Credit Suisse Chief Sees Little 1mpact From Tax Evasion Plea

Arnd Wiegmann/ReutersBrady W. Dougan, the chief executive of Credit Suisse, expressed regret for the bank's past misconduct. Related Links

LONDON — A day after Credit Suisse pleaded guilty to tax evasion in the United States, Brady W. Dougan, its chief executive, said on Tuesday that the bank took full responsibility for its actions but emphasized that it had seen little effect on its business.

"We have found no instances where clients cannot do business with us," he said. "Our discussions with clients have been very reassuring and we haven't seen very many issues at all."

Credit Suisse shares were up about 1 percent in trading in Switzerland.

On Monday, Credit Suisse pleaded guilty to one count of conspiring to aid tax evasion in a scheme that spanned decades. The bank will pay about $2.6 billion in penalties and hire an independent monitor for up to two years.

The bank, Switzerland's second-largest after UBS, said the settlement would reduce second-quarter net income by 1.6 billion Swiss francs, or about $1.8 billion.

On a call with analysts and reporters on Tuesday, Mr. Dougan said the bank would pare its assets to try and restore its capital levels in the wake of the fine.

The bank will reduce so-called risk-weighted assets by $14 billion, to $266 billion, and sell noncore assets including real estate to try and restore its common equity Tier 1 capital — a measure of its ability to absorb losses — to 10 percent by the end of 2014. The capital level would have been at 9.3 percent in the first quarter of 2014 had the charges from the settlement been applied.

The bank said it would return half of its earnings to shareholders once it had restored that 10 percent level. Its long-term goal for common equity Tier 1 capital is 11 percent.

Mr. Dougan, 54, who has been at the bank for 25 years and has been the chief executive since 2007, said he never considered resigning over the incident, and he disputed the characterization that the bank had dragged out discussions with American officials.

"We did everything we could to bring this to a resolution," he said. It was complicated by "government-to-government" conversations, he said, and Swiss law that prohibits the release of client data.

In 2009, UBS agreed to pay $780 million and turned over the names of about 4,000 American account holders after the Swiss government passed measures that allowed the bank to effectively bypass Swiss secrecy laws. As part of the settlement, UBS avoided criminal prosecution in the investigation.

Mr. Dougan said there were two key differences with the UBS settlement. The Swiss government allowed UBS to provide names; it did not do so with Credit Suisse. And five years later, fines are significantly higher.

"Everyone is obviously very aware of the inflation of costs in settlement issues," he said.

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