Credit Suisse Says Bonus-Pool Increase to Be Smaller for 2017

Credit Suisse Says Bonus-Pool Increase to Be Smaller for 2017

Credit Suisse recorded a full-year net loss last year as changes in USA taxes wiped out its profits.

The prior year results included net litigation provisions of CHF2.47 billion, primarily relating to the settlements with the US Department of Justice and the National Credit Union Administration Board regarding the bank's legacy residential mortgage-backed securities business.

The Zurich-based financial institution, which has been undergoing a three-year restructuring under CEO Tidjane Thiam, says its net loss during the quarter shrank to 2.13 billion Swiss francs ($2.28 billion) from 2.62 billion francs a year earlier.

For the year, the bank tallied an income tax expenses of 2.74 billion francs, mostly linked to a "re-assessment of deferred taxes resulting from the US tax reform".

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Credit Suisse has come under pressure from an activist investor, Swiss hedge fund RBR, which took a stake in the bank a year ago and is pressing for the firm to hive off its investment bank and move it to NY from Zurich.

The group said it would propose a reduced dividend of 0.25 francs per share, compared to 0.70 francs in 2016 and average expectations for 0.28 francs amongst eight analysts polled. In recent years, the bank has heavily incentivized investors to take more shares, not cash. He said the product had not had a material impact on the firm's finances. "As a result of these efforts, we are in a significantly improved position to benefit when market conditions improve", CS said.

The bank's private banking arm took in 37.2 billion francs in fresh money from clients - a key indicator of future revenue. This unit saw an increase of 13 percent year-on-year for its assets under management. "We should generate 4 to 5 billion (francs) of surplus in (2018) which can then be distributed".