Credit Suisse's momentum in Asia, the bank's main growth market, stalled in the second quarter. What was the main culprit?
The cooling that began exhibiting itself at Credit Suisse in Asia last quarter has spread. The Swiss bank's assets under management in Asia stood at 177.8 billion Swiss francs at the end of June, a meagre 400 million higher compared to the previous quarter after translating local currencies into Swiss currency.
The bank however won 4.5 billion francs in net new assets off clients, mainly from greater China and southeast Asia.
Cost Cuts Offset
Profits from its Asia private bank slipped to 196 million francs, as revenue also fell – a drop the Helman Sitohang-led unit was easily able to offset by cutting jobs and other spending as well as through lower provision for credit losses.
The number of relationship managers in Asia dropped for the second successive quarter to 610, from 620 in March and 650 at the end of last year.
During the second quarter period in Asia the bank launched «Credit Suisse Invest», a new digital advisory solution and rolled out a digital wealth management platform in Thailand.
Investment Bank Slide
Credit Suisse's securities unit in Asia produced its third loss running, though it narrowed the loss to just 8 million francs in the second quarter.
Why? Revenue crumbled by more than one-third, as fixed income and equities both slid. Sitohang also didn't have a 65 million franc benefit that he did year-ago from revaluing hybrid derivative instruments.
