UBS still beckons mega profits
Credit Suisse reports billions in losses
08/27/2023 3:28 p.m
The problems of the ailing major bank Credit Suisse did not end with the takeover agreement by arch-rival UBS in the spring. According to a report, it posted a loss of several billion francs in the second quarter. Nevertheless, the takeover will probably bring the new owner a gigantic balance sheet profit.
According to a media report, Credit Suisse, which was taken over by UBS in June, was deep in the red in the second quarter of 2023. The loss of the major Swiss bank totaled 3.5 billion francs (about 3.7 billion euros), reported the “Sonntagszeitung”, citing insiders. UBS and Credit Suisse spokesmen declined to comment. Credit Suisse had forecast a significant pre-tax loss for the second quarter and full year of 2023 back in April given the exit from non-core businesses, restructuring costs and funding costs.
UBS will present its quarterly financial statements on August 31st. Credit Suisse is also consolidated for the first time for the month of June. According to a survey conducted by UBS itself, analysts expect the group to make a profit of $33.5 billion. The main driver is likely to be a book profit from the emergency takeover of Credit Suisse orchestrated by the Swiss government in March. According to a document filed with the US Securities and Exchange Commission in May, this amounts to $34.8 billion.
According to the newspaper report, UBS is also likely to provide further details on the integration of Credit Suisse and an austerity program. UBS also wants to part with customers who are no longer wanted. These included Russians in particular. UBS also declined to comment.
In March, the Swiss government forced rival UBS to take over Credit Suisse after Credit Suisse had faltered due to scandals and massive financing problems. Ultimately, UBS paid CHF 3 billion for Credit Suisse. The merger was completed in June.