Credit Suisse to cut 4,000 jobs amid first loss since financial crisis

Credit Suisse reveals first annual loss since 2008, and confirms 4,000 jobs are to be cut.

Credit Suisse has suffered its first annual loss since 2008 and confirmed 4,000 jobs are to be cut in its annual results statement. 

The bank today reported it suffered a pre-tax loss of CHF 2,422 million in 2015 and a pre-tax loss of CHF 6,441 million in the fourth quarter.

Its Global Markets (GM) division reported a 14% decline in revenues, with fixed income sales and trading revenues suffering a loss.

Credit Suisse created its GM division in October, bringing fixed income and equities businesses under a single roof.

The report explained: “The restructuring of GM activities is also continuing as we further reduce fixed income legacy positions and make the franchise less vulnerable to negative developments in the credit markets.”

Prime services results increased slightly despite significantly reduced leverage exposure, reflecting continued progress on our client portfolio optimisation strategy.

The Asian Pacific region, however, reported an increase in revenue for fixed income sales and trading of 15%, which Credit Suisse said was due to “investments in key hires” and “platform enhancements”.

Tidjane Thiam, chief executive officer at Credit Suisse, said: “Our focus will be on continuing to make the fixed income business model significantly less volatile and inventory dependent along the lines of our successfully transformed equities business.”

It was also announced the bank would be cutting 4,000 jobs as part of a cost-saving strategy. The report said: “We are implementing a reduction of approximately 4,000 positions (employees, contractors and consultants).”

Credit Suisse has targeted savings of CHF 3.5billion by the end of 2018.

Its litigation costs were significant to the results, as it announced CHF 821 million was spent on legal issues in 2015 and CHF 564 million in the fourth quarter.

The TRADE reported earlier this week that Credit Suisse had agreed to a settlement of $84.3 million with the SEC, after lawsuits were filed for misleading investors in its dark pools.