Net profit at Swiss bank Credit Suisse has fallen in the third quarter to SFr609 million ($630 million), as slow equities trading eats into investment banking earnings.
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This is a 74 per cent drop from the SFr2.35 billion net profit it reported in the same period of 2009 and far below analysts’ expectations.
The Zurich-based bank said on Thursday that given “challenging conditions” the results were “solid” and forecast higher returns as markets improve.
Investment banking pre-tax income fell to SFr395 million from an already subdued SFr784 million the previous quarter, as CEO Brady Dougan’s strategy to hire investment bankers aggressively in the second quarter backfired with markets flattening.
Earnings at Credit Suisse’s bedrock private bank outstripped the normally more lucrative investment banking segment for the second quarter running.
Credit Suisse again stressed that it was well-prepared to meet tighter regulatory requirements for capital reserves, including the so-called “Swiss finish” proposed by national financial supervisory authorities to protect the country’s two biggest banks from collapse.
Rival UBS announce its third-quarter figures on Tuesday.
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