Softer markets and an equity slowdown – most notably from China’s property and tech sector – weighed down on Credit Suisse’s first quarter performance in Asia Pacific, sources told finews.asia.

Poor Chinese market performance fuelled de-risking in the past year, leading banks in the region to suffer from weaker performance.  

This included Credit Suisse's Asia Pacific unit which posted a 14 percent dip in net revenue and around 100 million Swiss francs in losses for the first quarter, compared to 700 million francs in the same period a year ago.

«Significant industry-wide headwinds from softer markets, a slowdown in China equities led by the real estate and technology sectors and geopolitical tensions weighed on client activities in wealth management and investment banking [in Asia],» a source familiar with the matter told finews.asia.

AUM Drop

Despite net new assets of 2.5 billion francs in the first quarter, assets under management (AUM) fell 9.3 overall to 266.2 billion francs, according to the bank’s latest results.

The AUM drop could be attributable to poor market performance in the region and Credit Suisse separately said that it was undergoing de-risking measures for its wealth management business in the last 12 months, underlining notable concentration risk in Asia. 

AM, IB

Despite the profit pressures, the asset management arm of Credit Suisse’s APAC division saw net revenues improve compared to the first quarter of 2021, the source added.

And its investment bank continued to participate in major corporate transactors, especially M&A, with notable deals like Axis Bank’s $1.6 billion acquisition of Citi’s consumer business in India or the $5.8 billion sale of Singapore Press Holdings to Cuscaden Consortium.

Leadership Change

Alongside its first quarter results, the bank also announced a change in regional leadership with APAC chief executive Helman Sitohang stepping down and succeeded by APAC co-head of investment banking Edwin Low, effective July 1 this year.  

Sitohang will remain with the bank as a member of the APAC advisory council and senior advisor to group CEO Thomas Gottstein.

«Having led Credit Suisse Asia Pacific since 2014 as its longest-serving regional CEO, I have decided to focus my efforts on developing our strategy and key client relationships as senior advisor to our group CEO,» Sitohang said. «[Low and I] have worked together over many years and I have no doubt that he will lead the bank capably to successfully execute on our strategy in APAC.»