When Credit Suisse held an investor day in December, the world looked different. And this has an impact on how the bank now views its profitability targets.
The second-biggest Swiss bank on Thursday delivered an extensive report on the first quarter and reevaluated the targets it had set itself on December 11 at the investor day. The target rate for return on tangible equity (ROTE) of 10 to 11 percent in 2020 and 12 percent in the medium term was very much a key promise of the bank.
Credit Suisse now says that it is not possible to forecast the impact of the current crisis on its targets in 2020.
Further Cost Savings?
The bank still «hopes» to reach its medium-term target for return on tangible equity according to the plan and that may mean cutting costs. Credit Suisse had already in December warned that additional savings would have to made achieved should an adverse environment demand such. That adverse environment now looks very much to have become reality.
Today’s report may not be well received by investors because the bank had already had to pull its last profitability target, set for 2019. CEO Tidjane Thiam, who left the bank in February, had been optimistic that the pressure on the bank would decline partially in 2020.
