Credit Suisse eyes more cost cuts, reports SonntagsZeitung

ZURICH (Reuters) – Credit Suisse is considering how it could cut costs further after the struggling bank’s dismal performance in the past quarter, SonntagsZeitung reported, citing senior sources.

“The numbers are catastrophic,” an unnamed senior banker told the newspaper, adding that staff morale was very low.

Executives and the board are currently discussing a new sweeping cost savings plan, a second executive told the newspaper in an article published Sunday.

“The cost structure is too large for the bank’s revenue potential.”

Credit Suisse has previously described 2022 as a “transition” year as it tries to move on from costly scandals that have led to a near-total senior management reshuffle.

Discussions of the cuts are at an advanced stage, according to the newspaper, although it is not certain whether they will be announced when Credit Suisse reports its second-quarter results on Wednesday.

A Credit Suisse spokesman declined to comment to Reuters on the newspaper story.

The bank warned in June that it would post a loss for the quarter, its third in a row.

The lender then said it was aiming to accelerate cost-cutting measures introduced as part of its reorganization last November.

Analysts expect a reported net loss of 398 million Swiss francs ($414.02 million) for the quarter, according to Refinitiv data.

Switzerland’s second-biggest bank has been hit by a series of costly scandals and the exit of President Antonio Horta-Osorio after flouting COVID-19 quarantine rules.

Among its woes was a $5.5 billion loss on the default of US family office Archegos Capital Management and the shutdown of $10 billion of its supply chain finance funds.

($1 = 0.9613 Swiss francs)

(Reporting by John Revill; Editing by David Goodman)

Copyright 2022 Thomson Reuters.

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