Stricter know-your-client requirements at Credit Suisse have reportedly caused a backlog in Asia where it can now take up to eight months to open an account.
After introducing more stringent source of wealth (SoW) corroboration standards for new clients in November, the new measures created a waiting list of more than 600 people by February, according to a «Financial Times» report citing unnamed sources.
It now takes regular clients six to eight months to be checked and approved for accounts and three to four months for wealthier clients – those with a minimum net worth of $100 million alongside $10 million to $15 million to be deposited.
Risk Tweaks
In response to the backlog, the bank relaxed rules in May with only 50 percent of SoW corroboration required for new «low risk» customers before confirming the other half within 12 months. Although the backlog reduced to 500 people by late spring, some clients «grew so frustrated they dropped out of the process and turned to rivals», the report said highlighting J.P. Morgan as a notable example.
«Our bankers are continuing to bring in new clients to the bank,» Credit Suisse said in a statement, adding that the bank was reviewing IT and personnel needs. «When onboarding these new accounts, it’s very important to us that we fully meet all the regulatory requirements.»
Credit Suisse looks to expand its wealth business in new era of stricter risk management, an issue that is particularly relevant in Asia where limited transparency has cost the Swiss bank, most notably from the Luckin Coffee scandal of 2020. While it tightens its KYC rules, Credit Suisse is also seeking to extend its reach to the mass millionaire segment in the region, said global wealth management head Francesco De Ferrari in a recent investor session.
