Credit Suisse posts record quarterly loss after US tax settlement
Tuesday 22 July 2014
Credit Suisse has reported its biggest-ever quarterly loss after it pleaded guilty to the US Department of Justice over aiding tax evasion in May and paid $2.6 billion (£1.5 billion) as part of a settlement with authorities.
The bank, Switzerland’s second biggest, which employs 7500 people in London, made a loss of Swfr 749 million (£486.8 million) in the three months to June. Even without the DoJ deal profits were down 13% at SFr 882 million.
“I want to reiterate that we deeply regret the past misconduct that led to this settlement and that we take full responsibility for it,” said chief executive Brady Dougan.
But he went on to say the deal had not destroyed customer loyalty.
“The continued trust and support of our clients helped us mitigate the impact of the settlement on our business.”
Dougan said: “During the quarter, we continued to see good momentum with clients, while at the same time making further progress in winding-down our non-strategic units.”
But he admitted that both wealth management and investment banking had suffered from subdued trading by clients in some financial markets.
Credit Suisse said that its estimate for future possible hits from regulation or litigation not already provided for had now dropped from a maximum Swfr 2.4 billion to Swfr 1 billion.
Investment banking, much of it based in Canary Wharf, saw year-on-year profits flat at Swfr 752 million for the quarter but down from the first-quarter’s Swfr 827 million.
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