Credit Suisse said trading by both private clients as well as at its investment bank is booming amid the coronavirus pandemic.
The Swiss bank issued a trading update ahead of an annual brokerage conference on Thursday at which CEO Thomas Gottstein and finance chief David Mathers are due to speak. Their message as Credit Suisse closes out the last weeks of the first quarter is: resilience.
Its pre-tax income already exceeds the 1.06 billion Swiss francs ($1.14 billion) posted in last year's first quarter. The trading update illustrates the Zurich-based bank is harvesting the fruits of a revitalization under previous CEO Tidjane Thiam. Its return on tangible equity for January and February is higher than 10 percent, its target.
Trading Boom
Credit Suisse's private banking business saw revenue rise on the year because of more transactions, the bank said in a statement. Its markets and trading arm posted «significantly higher» sales and trading income on the year. This effect offsets a slump in other business in the pipeline now stalled, like initial public offerings, Credit Suisse said.
«The impact of the pandemic on our financial results going forward remains difficult to assess at this stage and we continue to monitor our credit exposures prudently in light of these conditions,» the bank said. «However, we are very satisfied with how the teams have so far navigated the increased volatility, including in areas such as share-backed lending.»
Lending to Wealthy?
Credit Suisse didn't make specific mention of margin calls on wealthy client lending. The Swiss bank has more aggressively loaned its clients money in recent years, part of a bid to win more business.
The trading update follows a similar statement from crosstown rival UBS on Wednesday. Bank stocks have slid amid worries that the pandemic's damaging effect on the global economy is overshadowing broad policy moves meant to counter the fallout.
