Newspaper article International New York Times

Credit Suisse Has Loss in 'Challenging' Quarter

Newspaper article International New York Times

Credit Suisse Has Loss in 'Challenging' Quarter

Article excerpt

The Swiss bank is in the middle of an extensive overhaul as it seeks to shrink its investment bank and place more emphasis on wealth management.

Credit Suisse said on Tuesday that it had lost money in the first quarter as turbulence hurt its global markets and investment banking business.

Tidjane Thiam, who joined Credit Suisse as chief executive in July, is in the midst of an extensive overhaul of the Swiss bank, shrinking its investment bank and placing greater emphasis on its wealth-management business, particularly in Asia and other emerging markets.

Mr. Thiam announced an acceleration of those efforts in March after he said that top executives had been surprised by the size of large, risky positions in the bank's trading book.

The lender's turnaround has not been helped by turmoil in the financial markets, which have cut into results across the industry and sent Credit Suisse last year to its first annual loss since 2008.

In the first three months of the year, Credit Suisse, based in Zurich, reported a loss of 302 million Swiss francs, or about $311 million. The bank reported a profit of 1.05 billion francs in the first quarter of 2015.

The Swiss bank reported a loss of 484 million francs before taxes, beating analysts' expectations.

"In the first three months of the year, we have remained focused on executing our strategy with three clear priorities: accelerating our cost and headcount reduction efforts, delivering profitable growth in wealth-management-focused divisions and maintaining our strong capital position," Mr. Thiam said in a news release. "We have been able to make good progress in all of these areas against an extremely challenging market backdrop."

Revenue declined 30 percent, to 4.64 billion francs, in the first quarter, from 6.65 billion francs a year earlier.

The bank's global markets and investment banking businesses both showed pretax losses in the quarter, as the lender navigated "some of the most difficult markets on record" and trading volumes and client activity were "drastically reduced," Mr. …

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