Swiss Credit Bank.
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LONDON – Credit Suisse gained a better-than-expected loss in the fourth quarter of 2020, due to higher provisions for legal disputes.
The Swiss bank on Thursday reported a net loss of 353 million Swiss francs ($ 392.8 million) during the fourth quarter of 2020. It was better than market expectations. According to Refinitiv, analysts had forecast a net loss of 558.5 million Swiss francs for the quarter and a net profit of 2.8 million Swiss francs for the year. Credit Suisse ended 2020 with a net profit of 2.7 billion Swiss francs.
The Swiss bank had notified markets in January that it would sink to a higher-than-expected loss in the last quarter of 2020 after setting aside $ 850 million for a legal dispute over real estate debt in the United States. Credit Suisse then agreed to a $ 600 million settlement last week.
Thomas Gottstein, CEO of Credit Suisse, said in a statement: “Despite a difficult environment for companies and economies in 2020, we saw strong performance underlying wealth management and investment banking as we tackled historical issues “.
Other highlights of the quarter:
- The CET 1 ratio, a measure of bank solvency, reached 12.9% compared to 12.7% a year ago.
- Revenue stood at 5.2 million Swiss francs, up from 6.2 million Swiss francs a year ago.
- Total operating expenses amounted to 5.2 million Swiss francs, compared to 4.8 million at the end of 2019.
The bank’s wealth management division saw revenue fall 24% year-on-year in the fourth quarter. Global Investment Banking, on the other hand, recorded a year-on-year jump of 19% in revenue.
Pandemic precaution
In January, Credit Suisse also announced that it would start buying between 1 and 1.5 billion Swiss francs of its own shares from 12 January. The bank has added that it will pay a dividend of 0.2926 Swiss francs per share in relation to its 2020 Results.
In the future, Credit Suisse seemed cautious on the back of the pandemic. “We would warn that the COVID-19 pandemic is not far behind and, despite continued fiscal and monetary stimulus, the pace of recovery remains uncertain,” the lender said in a statement.
The share price has risen by about 12% since the beginning of the year.