CREDIT Suisse, Switzerland's second-largest bank, has raised its target for cost reductions for a third time in seven months after it posted fourth-quarter earnings that fell short of analysts' estimates.
Credit Suisse will seek an additional €325m in cost savings by the end of 2015, on top of €3.2bn in planned cuts announced since 2011.
Chief executive officer Brady Dougan said that the measures the bank has already taken put it in a position to "thrive" regardless of market conditions. The company's fourth-quarter net income of 397m Swiss francs (€323m) compared with a year-earlier loss and a 647.6m franc profit estimate by analysts.
"We're coming into 2013 very well positioned, having done a lot of hard work of reducing costs, of reducing our risk- weighted assets," said Mr Dougan.
"We really have a business model that's ready to perform I think quite well and resiliently in 2013 and beyond."
Credit Suisse reaffirmed in November its commitment to a fully fledged investment banking platform after UBS, the biggest Swiss bank, said it would cut 10,000 jobs and shrink debt trading to focus on money management.
UBS this week posted a net loss of 1.89bn francs in the fourth quarter after booking a fine for trying to rig global interest rates and costs tied to the reorganisation.
Pre-tax earnings at Credit Suisse's investment bank amounted to 298m francs in the quarter, compared with a loss of 1.43bn francs a year earlier.
Revenues at the investment bank fell 16pc to 2.66bn francs in the quarter from the previous three months, with fixed-income revenues dropping 39pc to 887m francs.
Credit Suisse said it aims to lower the cost-to-income ratio at the investment bank to 70pc in 2015 from 84pc last year by cutting expenses and boosting revenue through growth initiatives. So far in 2013, revenue has been "consistent with the good starts in prior years", said Mr Dougan. (Reuters)