Brady Dougan, chief executive of Credit Suisse, expects volatile market conditions to continue to weigh on performance at the Swiss bank.
The expected upturn in the financial markets has failed to materialise this year as the global economy experiences yet more setbacks. Credit Suisse is one of a number of international banks to disappoint with recent results.
“Low interest rates and the strong franc are applying pressure on our earnings,” Dougan told the Neue Luzerner Zeitung newspaper on Monday. “We expect a long phase of volatility.”
Banking operations around the world have been hit by falling equities, low interest rates and risk aversion among clients. Swiss banks have been dragged down by the strong franc, which makes up a large part of the cost base, while taking in new assets in weaker currencies such as the euro and the dollar.
Dougan was cautious when asked whether Credit Suisse could raise its return on equity ratio (the amount of profit it earns from investments) from a current level of ten per cent to 15 per cent.
“We’ll have to see,” he said. “It is very difficult to assess the current situation on the capital markets.”
Dougan was adamant, however, that Credit Suisse had adopted the right business model to see it through the tough times.
swissinfo.ch and agencies