Credit Suisse Tax Issue Not a Surprise: Becker

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Feb. 26 (Bloomberg) -- Dirk Becker, Deputy Head of German Research at Kepler Cheuvreux, discusses Credit Suisse helping wealthy Americans evade taxes and why the act was disappointing but really not a big surprise. He speaks on Bloomberg Television’s “The Pulse.” (Source: Bloomberg)

Dougan and the shareholder base of credit suisse?

I think it is a little disappointing, it is not coming as a complete surprise.

That these investigations have been going on for a wild.

The paper that emerged yesterday is a political paper, i talked to credit suisse this morning, they can confirm the numbers -- they stand by the numbers they indicated earlier.

I don't think it comes as a big surprise.

What are the impacts moving forward?

Are they going to have to change the way they do business?

They have already changed the way they do business in the u.s.. in the past, it was more or less common practice to allow a u.s. citizen to have a bank account in switzerland and not declare them.

This has been stopped in 2009. the business credit suisse is running today is already without this.

The most tangible impact will be a financial find able software.

Speculation is wide, it is centered around $1 billion or so.

How much reputational damages there?

Reputational damage for swiss banks has been done.

We had a case with ubs a couple years ago, ubs was twice as big as credit suisse and received a $780 million fine.

They suffered reputational issues in the u.s. and beyond.

Credit suisse is in the same cap, their business was half as big but the damage will be very much the same.

To what extent will senior management be exposed here?

The allegations coming out of the committee are that this went right to the top.

There's clearly no evidence of that at the moment that has been made public.

The sec could be getting involved, there is maybe a little bit more room to run on this story.

How exposed is brady dougan personally?

The sec related part of this last week already.

That is more or less done.

The senior management is always difficult to say.

Rated to do and only became ceo of credit suisse in 2007. shortly before the whole business was stopped.

I do not necessarily think that he will have a big personal involvement in this case.

In terms of what else we can expect for the rest of the swiss banking sector, we have had ubs and a much smaller swiss bank, we now have credit suisse.

This is really driving on for the swiss banking sector.

Absolutely.

They used to do a lot of this business in the u.s. and in europe.

They will have to walk away from this business and this will have big implications on the cost side of the business.

The possibility of -- the popularity of swiss private banking will fall, it has already fallen before the crisis and will not necessarily recover.

This is a big change with private banking.

In terms of what credit suisse does next -- ubs changed its business model.

That relates to investment banking.

Are we going to see changes in the way that credit suisse is structured?

Do you think they go the same way as ubs?

What is the future for this bank and the environment you just described?

I think it is not necessarily a great idea to focus the entire business on private banking.

Profitability and margins are under pressure.

For credit suisse it is a big advantage they have managed to preserve such a large part of their investment banking.

It is comfortably covering its cost of capital.

Credit suisse can count himself lucky that they still have this investment bank and that they have more diversified earnings.

Credit suisse is not in such a bad position.

It is cheap compared to other

This text has been automatically generated. It may not be 100% accurate.

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