Switzerland’s second largest bank Credit Suisse is seen here next to a Swiss flag in downtown Geneva.
Fabrice Coffrini | AFP | Getty Images
Swiss credit on Thursday posted a quarterly loss that was significantly worse than analyst estimates, as it announced a massive strategic overhaul.
The embattled lender posted a third-quarter net loss of 4.034 billion Swiss francs ($4.09 billion), compared to analyst expectations for a loss of 567.93 million Swiss francs. The figure was also well below the 434 million Swiss franc profit posted for the same quarter last year.
The bank noted that the loss reflected a 3.655 billion Swiss franc impairment relating to the “reassessment of deferred tax assets as a result of the comprehensive strategic review.”
Under pressure from investors, the bank revealed a major overhaul of its business in a bid to address underperformance in its investment bank and following a raft of litigation costs that have hammered earnings.
In its widely anticipated strategic shift, Credit Suisse vowed to “radically restructure” its investment bank to significantly cut its exposure to risk-weighted assets, which are used to determine a bank’s capital requirements. It also aims to cut its cost base by 15%, or 2.5 billion Swiss francs, by 2025.
Credit Suisse expects to incur restructuring charges of 2.9 billion Swiss francs by the end of 2024.
This is a developing news story and will be updated shortly.