Credit Suisse in rude health after crunch

CREDIT Suisse cemented its reputation as one of the victors of the global recession yesterday as it swung back into the black with net profits of Sfr6.7bn (£4bn) for 2009.

Allaying fears after the Italian crackdown on tax havens left rival UBS gushing assets, Credit Suisse reported Sfr35.3bn net new money for its private banking arm. Group earnings per share were at Sfr5.3 and the bank underlined its robust position by announcing a restored dividend of Sfr2 per share.

Chief executive Brady Dougan remarked the institution’s environment and way of doing business had changed “fundamentally” over the past two years. He added: “Thanks to our forward-looking
approach, we entered this period of unprecedented industry change already in a robust position.”

Dougan was keen to emphasise this year’s remuneration payout ratio of 41 per cent was “historically low”, resulting in bonus and salary packages below 2007’s level at Sfr14.9bn.

The Swiss institution’s sheen was scuffed by a sharp drop in pre-tax investment banking profits in the fourth quarter to Sfr1bn due to a slowdown in corporate activity. Uncertainty over regulatory tightening of Swiss banking also cast a shadow over the year ahead.

Shares in Credit Suisse slid 0.7 per cent to close at Sfr45.8 as investors took profits, but analysts greeted the numbers positively.

Christian Stark of Zürich-based Chevreux said: “Despite difficult markets, Credit Suisse benefited from its franchise strength and the fact it is viewed as a winner within the industry. It’s geared to any recovery because it’s gained market share in investment banking, so if markets turn up it should benefit there too.”