But not in a good way. The statement (selected highlights) this morning:
Credit Suisse accelerates implementation of strategic plan; substantial reduction of risk and cost base; update on fourth-quarter performance
Continued commitment to integrated business model: investment in growth of Private Banking globally and Swiss businesses; substantial reduction of risk, volatility and costs in Investment Banking through the evolution of the business portfolio; continued focusing and alignment of Asset Management.
Investment Banking will further increase its focus on client and flow trading businesses. It will substantially reduce the scale of its operations in more complex products, including a general reduction in risk capital usage and the exit of certain proprietary and principal trading activities; Investment Banking will remain a valuable contributor to the integrated bank with lower volatility and attractive risk returns.
Credit Suisse has continued to cut risk in Investment Banking significantly:
- Underlying one-day value-at-risk (VaR) as of end-November 2008 has been cut by 34% quarter to date and by 60% year to date.
- Risk-weighted assets, measured on a consistent methodology basis, have been reduced from USD 236 billion as of end-2007 to USD 193 billion as of 3Q08, and are expected to decline further to USD 170 billion by end-2008 and to USD 135 billion by end-2009, a decline of 43% since the end of 2007.
Planned reduction in headcount of 5,300, primarily in Investment Banking, representing an 11% reduction of the bank’s current overall headcount.
These reductions, together with other cost efficiency measures, will reduce costs by CHF 2 billion, representing 9% of the bank’s reported nine-month annualized 2008 cost base.
Strategic measures outlined today will further reinforce the strong position of Credit Suisse from a risk, cost, capital and earnings perspective as it enters 2009.
Update on 4Q08 performance
Estimated net loss of approximately CHF 3 billion as of end-November 2008, reflecting the impact of adverse market conditions in the quarter and costs associated with the risk reduction program, primarily in Investment Banking; Credit Suisse was modestly profitable in November.
Good operating performance and solid asset inflows in Private Banking.
Deposit base and funding remain very solid and capital position remains strong; tier 1 ratio is expected to be around 13% as of end-2008.
Update on executive compensation
In light of Credit Suisse’s 2008 performance to date, the Chairman, Group CEO and CEO of the Investment Bank have informed the Board of Directors that it would not be appropriate for them to receive variable compensation for 2008.______