(AOF) – Credit Suisse, currently in the midst of restructuring, has warned that it expects to record a pre-tax loss of up to 1.5 billion Swiss francs in the fourth quarter. “In particular, investment banking was impacted by the substantial downturn in capital markets and reduced activity in sales and brokerage businesses, exacerbating the seasonal decline and relative underperformance of the group” .
The transformation of the Swiss bank requires in particular a radical restructuring of the investment bank.
“The actual results of the group will depend on a number of factors, including the performance of the investment bank for the remainder of the quarter, the continued exit from non-core positions, possible impairments of goodwill and the outcome of certain other actions, in particular the potential real estate sales “clarified the establishment.
Credit Suisse added that capital outflows had accelerated at the start of the fourth quarter to reach on November 11, around 6% of assets under management at the end of September. In wealth management, these outflows have “significantly declined” from the high levels of the first two weeks of October 2022, but have not yet reversed and represented around 10% of assets under management at the end of the third quarter. 2022.
AOF – LEARN MORE
The negative effects of rising interest rates
The rise in interest rates normally causes an increase in bank income through the loans granted. In Europe, according to a survey conducted by S&P among 85 banking establishments, the sector expects an average increase of 18% in its net interest income. However, this new inflationary context also has undesirable effects, in particular an increase in refinancing costs. It is also accompanied by the fear of a new recession, which would then affect all the bank’s businesses, ranging from loans to asset management, whose income is correlated to market valuations. Reassuring element: the banks of the euro zone are sufficiently solid to face a deterioration of their environment.