Credit Suisse today posted a hefty loss for the first quarter after suffering a multi-billion-pound hit from the collapse of US hedge fund Archegos.
The lender reported a pre-tax loss of 757m Swiss francs (£593m), down from a 1.2bn franc profit last year but marginally ahead of analyst expectations.
The figures were dragged down by a 4.4bn franc charge related to its exposure to Archegos, which collapsed last month after defaulting on margin calls.
Without the charge and other significant items, Credit Suisse would have recorded a profit of 3.6bn francs, its best quarterly results for at least a decade.
The Swiss bank also said it was raising capital by issuing notes convertible into 203m shares.
Chief executive Thomas Gottstein described the loss as “unacceptable”.
“Together with the board of directors, we have taken significant steps to address this situation as well as the supply chain finance funds matter,” he said. “We expect that our successful MCN [mandatory convertible notes] placement today will further strengthen our balance sheet and enable us to support the momentum in our core franchises.”
Credit Suisse was hardest hit by the collapse of Archegos, which sent shockwaves through Wall Street.
It said it expects a further 600m franc hit in the second quarter, but has already exited 97 per cent of its positions relating to the fund.
The saga was a further blow to Credit Suisse following the collapse of Greensill Capital, which was also a client.
Despite the overall hit, the bank posted strong trading in its Asia-Pacific and Swiss divisions — the only parts of its business not impacted by Archegos and Greensill.