Credit Suisse Profit Jumps on Wealth-Management Strength -- 2nd Update
Credit Suisse Group AG said Thursday its third-quarter net profit jumped on strong growth in wealth management, providing evidence that the Swiss banking giant's strategic shift toward managing wealthy clients' money is paying off.
The bank's net profit grew to 244 million francs ($244.2 million) compared with 41 million francs in the same period a year earlier. Analysts expected Credit Suisse to post net profit of 211 million francs, according to a consensus forecast provided by the bank.
Assets under management hit a record high last quarter of 751 billion francs.
Credit Suisse said pretax income from its international wealth management unit grew 59% last quarter from the previous year to 382 million francs, driven by strong growth in Asia. It saw net new assets of 10.4 billion francs, up 8% on the year.
Credit Suisse is two years into an overhaul under chief executive Tidjane Thiam, who took the reins in 2015, as the Swiss banking giant reorients away from profitable, but volatile, investment banking toward the more stable business of managing money for well-heeled clients.
"We are seeing the benefits of a number of key decisions we have taken to capture the wealth management opportunity," the bank said.
Overall revenue at Credit Suisse declined 7.9% on year to 4.97 billion francs. Analysts had expected revenue of about 4.98 billion francs, according to FactSet.
Credit Suisse said it generated cost savings of about 400 million francs in the third quarter, taking nine-month cumulative cost savings to about 1 billion francs. The bank said it is confident that it will finish the year below its 18.5 billion francs cost target.
The bank said that a mix of geopolitical risks, uncertainty over the timing of reforms in the U.S. and generally low volatility led to "muted" levels of client activity.
Write to Brian Blackstone at brian.blackstone@wsj.com and Pietro Lombardi at Pietro.Lombardi@dowjones.com
ZURICH -- Credit Suisse Group AG said Thursday its third-quarter net profit jumped on strong growth in wealth management, providing evidence that the Swiss banking giant's strategic shift toward managing wealthy clients' money is paying off.
The bank's net profit grew to 244 million francs ($244.2 million) compared with 41 million francs in the same period a year earlier. Analysts expected Credit Suisse to post net profit of 211 million francs, according to a consensus forecast provided by the bank.
Assets under management hit a record high last quarter of 751 billion francs.
The bank's shares rose 2% in early trading.
Credit Suisse said pretax income from its international wealth management unit grew 59% last quarter from the previous year to 382 million francs, driven by strong growth in Asia. It saw net new assets of 10.4 billion francs, up 8% on the year.
Credit Suisse is two years into an overhaul under chief executive Tidjane Thiam, who took the reins in 2015, as the Swiss banking giant reorients away from profitable, but volatile, investment banking toward the more stable business of managing money for well-heeled clients.
"We are seeing the benefits of a number of key decisions we have taken to capture the wealth management opportunity," the bank said.
Overall revenue at Credit Suisse declined 7.9% on year to 4.97 billion francs. Analysts had expected revenue of about 4.98 billion francs, according to FactSet.
Credit Suisse said it generated cost savings of about 400 million francs in the third quarter, taking nine-month cumulative cost savings to about 1 billion francs. The bank said it is confident that it will finish the year below its 18.5 billion francs cost target.
The bank said that a mix of geopolitical risks, uncertainty over the timing of reforms in the U.S. and generally low volatility led to "muted" levels of client activity.
Write to Brian Blackstone at brian.blackstone@wsj.com and Pietro Lombardi at Pietro.Lombardi@dowjones.com
(END) Dow Jones Newswires
November 02, 2017 04:37 ET (08:37 GMT)