Credit Suisse Loss Narrows In Fourth Quarter

Gladys Abbott
February 14, 2018

Credit Suisse ascribed the rise to CEO Tidjane Thiam's three-year deep restructure of the bank.

Following a flood of criticism from market commentators and financial firms alike, Thiam insisted that the product's demise was not a hit to the bank's reputation. "Which is generally what happens in markets".

The prior year results included net litigation provisions of CHF2.47 billion, primarily relating to the settlements with the US Department of Justice and the National Credit Union Administration Board regarding the bank's legacy residential mortgage-backed securities business.

Thiam was positive about business in the first few weeks of 2018. The Swiss bank flagged a sharp pickup of trading income this year, especially in Asia.

"Credit Suisse has been responding to requests from certain governmental and regulatory authorities ... regarding Credit Suisse's hiring practices in the Asia-Pacific region and, in particular, whether Credit Suisse hired referrals from government agencies and other state-owned entities in exchange for investment banking business and/or regulatory approvals, in potential violation of the US Foreign Corrupt Practices Act and related civil statutes", the bank said when reporting its full-year results for 2017.

After a strong start to 2018, Credit Suisse said: "Our market-dependent activities remain exposed to a number of uncertainties, from geopolitical developments, to the path and speed of interest rate changes in major economies", the Credit Suisse earnings release said.

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The bank said market volatility - which was also behind the meltdown of its exchange-traded notes used to bet on stock market swings - was a double-edged sword.

Investors say Credit Suisse's transformation is moving along.

"They're on the right track", Thomas Jaeger, a senior portfolio manager at Mirabaud Asset Management, said ahead of the results.

Credit Suisse posted its third consecutive annual loss on Wednesday, highlighting writedowns in the fourth quarter of 2017 due to the overhaul of the U.S.

"The most pleasing thing for me has been to see that our franchise is intact and actually vibrant", Thiam said in an interview with Francine Lacqua on Bloomberg Television.

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