“We’ve not made any particular change in mortgage provisions”, beyond one disclosed in February which lowered first-quarter results, Credit Suisse’s finance chief told investors on Thursday.
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The Swiss bank, which has a large investment banking and asset management operation in the U.S, reported solid second quarter profits of 1.1 billion Swiss francs.
European shares rose in early trading on Thursday on the back of better-than-expected results from several companies, including Credit Suisse, as the quarterly earnings season gathered pace in Europe. “I can not take credit, or actually blame” for the numbers, Mr. Thiam said during a presentation.
Important to keep in mind that the figure for last year’s period reflected the bank’s agreement to pay $2.6 billion to settle a U.S. probe of its aiding of American tax evasion.
“In the case of Barclays, it’s frankly all very new and we’ve got really no idea whether they might pull out of investment banking or not”, said Alan Beaney, investment director at RC Brown Investment Management Plc in Bristol, England.
The results also reflects a period following the Swiss National Bank’s decision in January to let the value of the franc rise sharply.
Credit Suisse said that equity sales and trading were strong in the quarter, driven primarily by increased activity in the Asia-Pacific region.
Mr Thiam said Asia would continue to be an important driver for Credit Suisse, given its growth potential.
Credit Suisse’s fixed income performance sounds pretty good compared to the 28% year-on-year reduction at Goldman Sachs or the 21% reduction at J.P. Morgan, but doesn’t exactly make for Thiam’s non-volatile future – especially when you consider that fixed income revenues fell 19% on the previous quarter.
Thiam was asked to turn the business around and focus on making cuts in its expensive investment bank and driving profits, while dealing with a strong Swiss Franc which dragged down the company’s business overseas. The region accounted for 70 per cent of the world’s population, and there were “huge” opportunities to attract business from ultra high-net-worth and high-net-worth clients there, he said.
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“The new strategy should address some of the pressures apparent in our second-quarter results”, Thiam said in a statement.
