Credit Suisse announced a huge third-quarter net loss that was worse than analysts expectations as the bank announced a major strategic overhaul today.
The Swiss bank reported a net loss of CHF4.03 billion, a huge plunge compared to only CHF504.9 million of net loss estimated by analysts. The loss was well below a CHF434 million of profit the bank made in the same period of last year.
Credit Suisse stated that pre-tax loss of CHF342 million compared to pre-tax income of CHF1.0 billion in 3Q21. The bank noted that income tax expense underlined its quarterly performance, significantly impacted by the impairment of deferred tax assets of CHF3,655 million as a result of the comprehensive strategic review.
Revenue was down 30% YoY, driven by substantially lower ECM and Leveraged Finance activity, as well as mark-to-market losses of USD 120 million, in the Investment Bank and subdued client activity in Wealth Management.
The bank plans to raise CHF4 billion by selling stocks and slashing thousands of jobs as well as spinning off its investment bank in an effort to recover from continuous losses.
The Swiss bank noted that it will create a capital release unit to wind down non-strategic, higher-risk businesses. It also announced the sale of a large part of its securitised products business as well.
