Credit Suisse posts worst loss since 2008 on tax settlement

Jul 23 2014, 00:47 IST
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SummaryCredit Suisse Group reported its biggest quarterly loss since the peak of the financial crisis in 2008, the result of a 1.6 billion Swiss franc ($1.78 billion) settlement with US authorities over helping its clients evade taxes.

Credit Suisse Group reported its biggest quarterly loss since the peak of the financial crisis in 2008, the result of a 1.6 billion Swiss franc ($1.78 billion) settlement with US authorities over helping its clients evade taxes.

Credit Suisse’s fixed income unit outshone both its wealthy client unit and its US rivals with a 4 percent rise in sales and trading. That compares to drops of at least 10% at American banks including Goldman Sachs and JPMorgan last week.

Credit Suisse said the investment bank cuts would allow resources and funds to be reassigned to its private bank, which disappointed investors with a 39% drop in revenue and swung to a loss due to the fine.

“I want to reiterate that we deeply regret the past misconduct that led to this settlement and that we take full responsibility for it,” Brady Dougan, chief executive of the Zurich-based lender, said on Tuesday.

“The continued trust and support of our clients helped us mitigate the impact of the settlement on our business.” Credit Suisse’s private bank has been under scrutiny since the bank’s guilty plea to the US criminal charge, with investors worried about clients pulling money out of its wealth management business as a result.

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