Credit Suisse makes profit in second quarter

 
City A.M. Reporter
Credit Suisse made a profit in the second quarter, including at its under-fire investment bank, it said on Friday, in an unscheduled statement that underscores the pressure it is feeling to restore confidence in its battered shares.

Credit Suisse shares have slumped to 20-year lows this week following a rebuke from the Swiss National Bank that it needs to bolster its capital base and a downgrade of its long-term debt by ratings agency Moody's.

That is despite a statement last Friday in which Credit Suisse's board backed chief executive Brady Dougan's strategy.

"Further to its statement of last Friday and in response to media reports about its second quarter financial performance, Credit Suisse informs that it expects based on quarter-to-date information to be profitable at the group level and in all its divisions," the Swiss bank said in a brief statement during trading hours on the last day of its second quarter.

Earlier on Friday, Switzerland's Tages-Anzeiger newspaper said Credit Suisse would make a profit in its second quarter.

It also said the bank might boost its capital by bringing forward 6 billion Swiss francs ($6.2 billion) of contingent convertible bonds, or CoCos, to the Olayan family and Qatari fund, both existing shareholders.

"It's unusual for banks to highlight market rumours, but maybe they felt as they go through negotiations on the Cocos they wanted to make public statement on profitability," Nomura analyst Jon Peace said. He rates the stock at neutral with a target price of 30 Swiss francs.