Credit Suisse Group AG yesterday said that business in the fourth quarter so far has continued the trend of the previous three months, when the lender got a boost from advising on deals while trading revenue trailed peers.
The investment bank “continues to perform well,” with revenue higher than in last year’s fourth quarter, Credit Suisse said in a statement on its investor day.
In wealth management, stronger transactional business especially in Asia is offsetting headwinds from the stronger Swiss franc and negative interest rates, it said.
Photo: Reuters
The bank confirmed a target for a return on tangible equity of 10 to 12 percent in the medium-term and for capital distributions, while cautioning that reaching that goal next year would depend on provisions for bad loans.
Credit Suisse chief executive Thomas Gottstein is seeking to turn the corner after a series of setbacks overshadowed his first year in office, from loan losses to questionable dealings for a large client.
While he simplified the organizational setup, including at the securities unit, and started a review of the asset management business, he has been unable to stop a constant flow of bad news.
In the latest hit, an impairment on a hedge fund stake and potentially surging legal provisions threaten to affect fourth-quarter earnings.
Since Gottstein combined the investment banking and trading activities in one unit, the business has shown mixed results, with advisory doing well in the third quarter, while fixed-income trading — the largest revenue contributor — trailed peers.
The bank did not give any details on its trading performance so far this quarter.
The heads of the two largest US lenders, JPMorgan Chase & Co and Bank of America Corp, last week told investors that their investment-banking and trading divisions would notch a strong performance in the fourth quarter as economic activity stayed fairly resilient.
At Deutsche Bank AG, fixed-income trading grew 10 percent in October and 23 percent last month.
The COVID-19 pandemic also exposed some weaknesses in Credit Suisse’s asset management model, a business that is typically a source of stable income with little risk for the bank, but which suffered a number of fund implosions this year as well as a scandal involving one of its largest clients, Softbank Group Corp.
Credit Suisse said that it expects a significant turnaround at the unit next year.
DAMAGE REPORT: Global central banks are assessing war-driven inflation risks as the law of unintended consequences careens around the world, spiking oil prices Central banks from Washington to London and from Jakarta to Taipei are about to make their first assessments of economic damage after more than two weeks of conflict between the US and Iran. Decisions this week encompassing every member of the G7 and eight of the world’s 10 most-traded currency jurisdictions are likely to confirm to investors that the specter of a new inflation shock is already worrying enough to prompt heightened caution. The US Federal Reserve is widely expected to do exactly what everyone anticipated weeks ahead of its March 17-18 policy gathering: hold rates steady. The narrative surrounding that
PRICE HIKES: The war in the Middle East would not significantly disrupt supply in the short term, but semiconductor companies are facing price surges for materials Taiwan’s semiconductor companies are not facing imminent supply disruptions of essential chemicals or raw materials due to the war in the Middle East, but surges in material costs loom large, industry association SEMI Taiwan said yesterday. The association’s comments came amid growing concerns that supplies of helium and other key raw materials used in semiconductor production could become a choke point after Qatar shut down its liquefied natural gas (LNG) production and helium output earlier this month due to the conflict. Qatar is the second-largest LNG supplier in the world and accounts for about 33 percent of global helium output. Helium is
About 1,000 participants, including more than 200 venture capitalists, joined the Taiwan Demo Day in Silicon Valley on Saturday, the largest iteration to date of the event held ahead of Nvidia Corp’s annual GPU Technology Conference which runs from today to Thursday. Taiwan Demo Day, co-organized by the Taiwan Next Foundation and the Startup Island Taiwan Silicon Valley Hub, took place at the Computer History Museum in California, showcasing 12 teams focused on physical artificial intelligence (AI) and agentic AI technologies. Katie Hsieh (謝凱婷), founder of the Taiwan Next Foundation, said the event highlighted the strength of the Taiwan-US start-up ecosystem, with
DOMESTIC COMPONENT: Huang identified several Taiwanese partners to be a key part of Nvidia’s Vera Rubin supply chain, including Asustek, Hon Hai and Wistron Nvidia Corp chief executive officer Jensen Huang (黃仁勳), addressing crowds at the company’s biggest annual event, unveiled a variety of new products while predicting that its flagship artificial intelligence (AI) processors would help generate US$1 trillion in sales through next year. During a two-and-a-half-hour keynote address, Huang announced plans to push deeper into central processing units (CPUs) — Intel Corp’s home turf — and introduced semiconductors made with technology acquired from start-up Groq Inc. The company even said it was developing chips for data centers in outer space. At the heart of Huang’s speech was the message that demand for computing power
RSS