Some of Credit Suisse Group’s junior and mid-level bankers will get their bonuses paid out in instalments, a latest twist in the firm’s handling of employee compensation amid a tumultuous overhaul. It will also dial back risk controls in Asia after bankers revolt. Some associates and vice presidents were told on Tuesday that the much-anticipated rewards will be doled out in chunks, according to people familiar with the matter. Each of the three instalments will be paid about 40 days after April 1, July 1 and October 1, the people said, asking not to be identified discussing private information. The bank is seeking to cling on to talent while contending with a restructuring of its Wall Street operations after a period of scandals and losses sparked a tide of departures. Credit Suisse abruptly delayed compensation day for some of its investment bankers at managing director or director level, pushing back conversations on bonuses that were meant to take place on Tuesday. A representative for Credit Suisse declined to comment. The Zurich-based lender plans to merge its investment-banking arm with rainmaker Michael Klein’s advisory boutique to become a First Boston unit that will eventually be spun out. Apollo Global Management is among financial firms showing an early interest in taking a stake in the unit, a separate person familiar with the matter said. Meanwhile, the bank is fighting to stem a wave of investor outflows and staff departures by dialling back some stringent anti-money-laundering controls in Asia after they drew protests from clients and bankers. A requirement that private bankers verify most of their clients’ sources of wealth was eased near the end of last year, while third-party transactions are no longer subject to executive approvals, according to people familiar with the matter. Credit Suisse cautiously optimistic as China investors back reopening The backtracking highlights the delicate balance facing the bank as it tries to tighten operations following a series of scandals, while hanging on to clients in one of the fastest-growing regions for money management. The measures, more stringent than at many peers, threatened to stall efforts to recover from massive outflows that contributed to another quarterly loss. Credit Suisse took steps in 2021 to tighten controls by commissioning Ernst & Young to assess its wealth units’ anti-money-laundering procedures in Singapore and Hong Kong. It was fined in 2017 by the Monetary Authority of Singapore for lapses linked to the bribery scandal at the 1MDB fund in Malaysia. Elsewhere, the lender sought to spruce up its image following a series of missteps by some of its clients, including collapses at Archegos Capital Management and Greensill Capital, and an accounting scandal at Luckin Coffee. It initiated the independent review by EY to “provide additional assurance of the quality of our internal process and controls.” “Based on the findings, which were in line with our own initial assessment, the firm established a robust ‘belt and braces’ approach” to anti-money-laundering, and enhancements were made to “improve our end-to-end operating model,” a Credit Suisse spokesperson said in a statement to Bloomberg News. To counter lapses highlighted by EY, senior managers in Asia demanded closer scrutiny on the sources of wealth for new clients and tightened rules for fund transfers to third parties, which sometimes included clients’ children, said people familiar with the matter. Soon after the report publication, the firm demanded that bankers corroborate the sources for up to 90 per cent of high-risk clients’ wealth, versus 70 per cent previously. For low-risk customers, the degree of corroboration was raised to 70 per cent from 50 per cent. Credit Suisse pledges commitment to Greater China as it announces overhaul The tighter controls did not sit well with many clients, or with bankers who were already struggling with the reputational hit from the scandals. The firm warned in November that client outflows will contribute to a fourth-quarter loss of up to 1.5 billion Swiss francs (US$1.6 billion when the company reports results on February 9. Many bankers who resigned in recent months said the changes made it harder for relationship managers to bring in new clients, and delayed account openings by as much as eight months. Attracting new clients and their money is a key performance metric for bankers and determines bonuses. More than a dozen senior bankers exited, including some top performers in the so-called Chairman’s Club, who are awarded big bonuses and other privileges. To be sure, these bankers, who declined to be identified, were already frustrated by Credit Suisse’s tarred reputation, and had good offers from other firms. They did not leave solely because of the beefed up measures, they said. China’s next economic tsar? He Lifeng raises profile with central bank visit Even a few “Culture Champions” – appointed to lead by example – departed. Young Jin Yee, deputy CEO of Asia-Pacific wealth management, resigned to join Deutsche Bank. Katryna Murtagh, managing director on the compliance side, decided to leave near the end of last year. The region’s compliance head Pete Monaci quit in June to join Citadel Securities in Hong Kong. In response, Credit Suisse has relaxed some of the controls. As of early December, bankers are required to match clients’ information as much as possible rather than hitting firm percentage levels, according to one of the people. Another measure requiring senior managers to approve client fund transfers to third parties was also eased at the end of last year, the people said. Private bankers can now lift the restrictions on accounts that have been blocked by compliance, they said. Malaysia’s Anwar to focus on rising debt in budget; central bank to hike rates The bank is also addressing attrition. It hired Rashmi Dubier, MUFG Bank’s former Asia-Pacific head of anti-money-laundering, for a financial crime compliance role. Other measures to strengthen the bank’s controls and monitor risks continue to be implemented and assessedthe people said. Finma and EY spokespeople declined to comment. The MAS cannot share details of dealings with individual firms as they are confidential, a spokesperson said. Singapore is one of the bank’s largest operations in the Asia-Pacific region, with about 3,300 staff, including the bulk of its 800 private bankers for the region. The city-state has been ramping up efforts to combat illicit flows as more money pours in. “These reviews and ensuing initiatives are part of our regular course of business to operate more efficiently, improve client experience while managing risks for the firm,” the Swiss bank said. “Regular progress updates are provided to our regional regulators to monitor progress and achievements delivered by key initiatives.”