Published: Thu, February 15, 2018
Markets | By Rosalie Gross

Credit Suisse Is Finally Finding Its Sweet Spot

Credit Suisse Is Finally Finding Its Sweet Spot

The bank said it will pay its first all-cash dividend in four years, a move it adopted last year following a pay snafu which saw Credit Suisse (CS) back down amid massive pressure from large institutional investors. Credit Suisse shut down the product because there is no prospect of price recovery and will compensate investors on February 21. "This year should be the first year where that (surplus) number is actually meaningful", Thiam said. "That was the last challenge in the restructuring, because wealth management is going well".

"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).

Credit Suisse says it narrowed its fourth-quarter loss as pre-tax income swung into the black, while the Swiss bank predicted a positive impact from the US tax reform in the future.

Credit Suisse shares rose 3.7 percent to 17.1 Swiss francs by 0935 GMT. The Swiss bank is among the best performers in the index over the past six months, with a gain of more than 16 percent. "It's still a cheap stock", he said. In recent years, the bank has heavily incentivized investors to take more shares, not cash. Laurent Mignon, the CEO of France's Natixis SA, said in an interview Wednesday that his bank has seen "good activity" since the start of the year. Fourth quarter revenues hit CHF5.2 billion.

The company warned in the prospectus that the product has "zero long-term value", he said.

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Overall, fourth-quarter revenue of 5.19 billion francs ($5.56 billion) at the bank beat the 5.04 billion franc estimate of eight analysts polled by Bloomberg.

Credit Suisse proposed a distribution of CHF0.25 per share be paid out of capital contribution reserves for the financial year 2017.

And, while revenues grew, Credit Suisse also reduced costs by 6% between 2017 and 2016.

Thiam was positive about business in the first few weeks of 2018.

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