Dow Jones Newswires: Credit Suisse posts hefty $1.51 billion loss as clients pull billions from wealth management business

by | Feb 9, 2023 | Stock Market

Credit Suisse Group AG notched up its fifth-straight quarterly loss in the last three months of 2022, missing expectations after clients pulled billions in deposits from its wealth-management business, and flagged a further full-year loss in 2023. The Swiss lender

on Thursday reported a fourth-quarter net loss of 1.39 billion Swiss francs ($1.51 billion) compared with a loss of CHF2.09 billion in the same period of 2021, as revenue dropped 33% on year to CHF3.06 billion.

A company-compiled consensus forecast had expected a net loss of CHF1.34 billion on revenue of CHF3.15 billion. At the same time, the bank acquired banker Michael Klein’s New York-based Klein & Co. operation for $175 million, with the expectation to fully integrate it into Credit Suisse’s new investment-banking business CS First Boston. The acquisition lays the groundwork for a carve out of CS First Boston, and an eventual listing, Chief Financial Officer Dixit Joshi said in a media call. It also said a deal with Apollo Global Management Inc. for the sale of a large part of its securitized-products business, which packages and resells debt, is expected to close in the first half of 2023 for a pretax gain of around $800 million. It comes as Switzerland’s second-largest lender is in the process of a extensive restructuring, its latest attempt to right the ship after a series of costly scandals, aiming to cut 9,000 jobs and reduce the group’s cost base by 15% by 2025. As part of its restructuring, its expects related expenses of around CHF1.6 billion in 2023 and about CHF1.0 billion in 2024, with the aim of cutting its cost base by close to CHF1.2 billion this year. It led Credit Suisse to anticipate a substantial loss before taxes in 2023, also based on a challenging market en …

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