The Swiss bank flagged a fourth-quarter loss on the back of a major write-down it plans to take for a 21-year-old acquisition.
Zurich-based Credit Suisse will post a loss in the last three months of this year because it plans to write down roughly 1.6 billion Swiss francs ($1.75 billion) from Donaldson, Lufkin & Jenrette, it said in a statement on Thursday. DLJ is an investment bank it bought for $11.5 billion in 2000.
The disclosure was made alongside a 20 percent tumble in third-quarter net profit to 434 million francs, following its guilty plea to conspiracy charges in a Mozambique scandal two weeks ago. Separately, Credit Suisse said it plans to merge its disparate wealth management units into a sole one, the result of a six-month strategy overhaul by António Horta-Osório.
Fee Waiver Due To Greensill
The bank, in the midst of maelstrom over a $10.1 billion line of funds co-managed by Greensill, said the partnership may incur more losses in future quarters. Credit Suisse said it is still trying to recover investors' money – it has thus far returned $6.3 billion of the funds total to them.
The issue is especially pernicious for Credit Suisse because the Greensill funds were sold to its wealthy private banking clients. The bank said it is offering to waive certain fees for these clients.
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