Credit Suisse Rallies as Thiam Rides Return of Volatility

Credit Suisse Rallies as Thiam Rides Return of Volatility

Credit Suisse shares are trading higher Wednesday, after the Swiss Bank reported a third straight annual loss, but one that was smaller than expected.

Credit Suisse recorded a full-year net loss last year as changes in US taxes wiped out its profits.

Credit Suisse reported a net loss for the fourth quarter of 2.13 billion francs because of changes to the US tax code.

The authorities in question included the Department of Justice and the US Securities and Exchange Commission, the Swiss bank said, adding that it was "cooperating with the authorities".

For the year, the bank tallied an income tax expenses of 2.74 billion francs, mostly linked to a "re-assessment of deferred taxes resulting from the USA tax reform". Its CET 1 ratio rose to 12.8 percent from 11.5 percent in the last quarter of 2016.

"2017 was a crucial year of delivery in our three-year restructuring plan, after 2016, which was a year of deep and radical reorganisation and restructuring", said chief executive Tidjane Thiam (left).

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But even without the changes in U.S. law since the end of a year ago, the bank is unlikely to show signs of improvement.

The logo of Swiss bank Credit Suisse is seen at a branch in Winterthur, Switzerland November 2, 2017. Thiam said that there will be further cost cuts in the business this year but that the main target would be to increase productivity.

However, 2018 could be the turning point.

Thiam pointed out that, nonetheless, it is up to the bank's board to make that decision. It said market volatility has had some benefits but has hurt its calendar, as clients "wait for calmer markets in order to transact".

After a strong start to 2018, Credit Suisse said: "Our market-dependent activities remain exposed to a number of uncertainties, from geopolitical developments, to the path and speed of interest rate changes in major economies", the Credit Suisse earnings release said.

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