Credit Suisse warns on investment bank

CREDIT Suisse Group chief executive Brady Dougan cautioned yesterday that the performance of the Swiss firm’s investment bank was mixed in the third quarter but added that the bank as a whole is well-positioned to deal with difficult market conditions.

Dougan said volumes in some businesses, including fixed income and currency trading, have been “a bit more subdued” in the third quarter. Equity trading, too, was marked by lower volumes, he said.

Dougan, speaking at a BoA Merrill Lynch conference, said Credit Suisse is in a good position to cope with difficult market conditions because its business model focuses on client flows and seeks to deploy capital efficiently.

At the same conference, incoming Barclays group chief executive Bob Diamond yesterday reassured investors that the bank has sufficient capital to meet Basel III requirements and will not look to tap them for more cash.

Diamond warned that the ongoing shake-up of bank regulation would have tough consequences for both the debt and equity funding markets, making funding scarcer and more expensive as banks struggle to keep on generating adequate returns.

But he added: “Of course we have a lot of work to do to adapt to the new Basel framework but from what we know and can see today, we believe we have enough equity capital and it is not our objective to turn to our shareholders for more.”