Credit Suisse’s 2017 turnaround may be gaining further legs, in spite of what was largely billed as a lackluster year for banking. Indeed, 2017 contains no shortage of industry headwinds, though after a successful Q1, Credit Suisse looks to be showing signs of a sustained recovery.
Credit Suisse is now portending a targeted cost base within the next two years, due in part to its broad-based restructuring, according to a Reuters report. The tone was echoed by Credit Suisse’s Chairman, Urs Rohner, who is eyeing a cost target of $17.4 billion (CHF 17.0 billion) by the end of 2018, a sum that is lower than its original cost target of $18.9 billion (CHF 18.5 billion).
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In a further nod to its strength, Credit Suisse’s shareholders are also slated to be voting on the board’s proposal to raise approximately $4.1 billion (CHF 4.0 billion) to help fortify its financial strength to a level that is on par with its rivals.
The announcement is welcome news to investors who earlier this year had to grapple with a dismal 2016 fiscal year that saw a $2.4 billion loss. More recently, Credit Suisse had largely reversed its fortunes, reporting a number of metrics all pointed higher across its business segments.
In terms of its net revenues, the group saw a figure of CHF 5.5 billion ($5.5 billion) in Q1 2017, up 19.0 percent year-over-year from Q1 2016. Nowhere was the reversal more evident than across Credit Suisse’s pre-tax income, which yielded CHF 670.0 million ($674.0 million) in Q1 2017 – this erased the CHF 484.0 million ($486.7 million) incurred back in Q1 2016. One of the paramount drivers of this trend was the Wealth Management unit’s strong performance, which had been flagged as one of the worst performers over the past six months.