Earlier this year, Credit Suisse announced that it would be accelerating its cost cutting efforts after FY2015’s disappointing results. The Swiss lender laid out plans to restructure its business in order to return to profitability after losing close to $3 billion and revealed that it was seeking to increase its cost cutting efforts by around $820 million.
At the time, Credit Suisse also revealed that the consolidation process of its Global Markets division would include a consolidation of the FX Cash and FX Options businesses into the STS operations of Credit Suisse, which are part of the Swiss Universal Bank.
Today’s news therefore comes as no surprise as Credit Suisse has announced more than CHF1 billion ($991 million) in extra cost cuts, as Chief Executive Tidjane Thiam looks to compensate for the on-going challenging conditions faced by the bank, as per a Reuters report.
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In a statement ahead of its investor day, Credit Suisse also lowered 2018 pre-tax income targets for its Asia Pacific and International Wealth Management divisions to CHF1.6 billion ($1.59 billion) and CHF1.8 billion ($1.79 billion) respectively. The previous target for both divisions was CHF 2.1 billion ($2.1 billion).
Just over a year since Thiam laid out his strategy for Switzerland’s second-biggest bank, analysts had been in anticipation of another axe to costs and a paring of profit targets, which had been perceived as too optimistic.
As noted, Thiam has already deepened job cuts once following unexpected losses in the global markets unit, bringing the total headcount reduction across the bank to 6,000 this year.
It is estimated that as many as 1,300 additional job cuts in Switzerland may be announced this week although the bank commented that at this stage: “We will not be giving a specific number of job cuts but we know what we want to do. We will give a small update on Q4 numbers in global markets but we are today not commenting globally on bank’s performance.”