Economy Credit Suisse posts first-quarter profit beat as revamp hits home stretch

Credit Suisse posts first-quarter profit beat as revamp hits home stretch

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File-The logo of of Swiss bank Credit Suisse is seen at an office building in Zurich’s Oerlikon suburb, Switzerland July 27, 2017. Picture taken July 27, 2017.

Credit Suisse on Wednesday reported a 16.4 percent year-on-year rise in first-quarter net income, its best quarter since Chief Executive Tidjane Thiam launched a three-year restructuring plan for Switzerland’s second-biggest bank.

After 6.56 billion francs in losses in 2016 and 2015 and a 2.3 billion franc tax writedown which erased 2017 gains, Credit Suisse said first-quarter net income attributable to shareholders was 694 million Swiss francs ($707.4 million).

This beat the average estimate in a Reuters analyst poll for 665 million francs and the bank’s own consensus compilation that saw net profit of 649 million francs.

“With these first-quarter results, we got off to a good start in our third and final year of restructuring, and we are

looking ahead to the future with confidence in our new business model and in our execution capabilities,” Thiam said in a statement.

But the bank flagged periods of heightened volatility amid geopolitical events, global trade tensions and the outcome of monetary policy tightening. “Client activity levels remain sensitive to these factors, specifically within our more market dependent activities,” it said.

Swiss rival UBS on Monday posted 1.5 billion francs in quarterly net profit as its investment bank navigated volatility better than Wall Street peers.

Credit Suisse’s common equity tier 1 capital ratio, an important measure of balance sheet strength which Thiam has looked to improve, rose to 12.9 percent from 12.8 percent at the end of the fourth quarter.

Net new money inflows — a closely watched indicator of future earnings in wealth management — totaled 14.4 billion francs across its three wealth management businesses, the highest in seven years.

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