John O’Donnell, Michael Shields

FRANKFURT/ZURICH – Credit Suisse announced on Thursday it would close its investment bank in order to concentrate on the building of its wealthy client base. The announcement came as Credit Suisse regroups after a string scandals.

It will close much of the bank’s prime brokerage business, including those dealing with failed hedge fund investment companies Archegos. The bank is focusing on its wealthy private bank, and will consolidate it into one global operation.

After reporting a 21% decline in profits for its third quarter, Bank of America stated it would be focusing on risk management.

Thursday’s announcement represents the first step in a process to control the bank. It is currently being charted. Credit Suisse (SIX) Antonio Horta Osorio was the bank’s chairman. He took control in April after the bank had to deal with reckless dealsmaking.

Credit Suisse was fined last year for setting up a fraud loan to Mozambique. Credit Suisse’s involvement with Greensill (defunct financier) has tarnished its reputation. Regulators have also rebuked the bank for spying on executive executives.

This cast a shadow over the bank and prompted the exodus key staff. It also fuelled speculation that the stock, which has stagnated, might even be purchased by a competitor.

($1 = 0.9124 Swiss francs)