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Credit Suisse posts Q1 loss as revenues fall 30% YOY


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Credit Suisse posts Q1 loss as revenues fall 30% YOY

Credit SuisseGroup AG reported a first-quarter net loss attributable toshareholders of CHF302 million, compared to attributable income of CHF1.05billion in the year-ago period, as the bank restructures amid turbulent globalfinancial markets.

The loss per share for the period was 15 centimes, comparedto EPS of 60 centimes in the year-ago quarter.

CEO Tidjane Thiam and Chairman Urs Rohner said theresult reflects challenges in the global economy but also indicates that thebank's strategy "is gaining traction in [its] chosen markets inAsia-Pacific, international wealth management and Switzerland."

Net revenues declined year over year to CHF4.64 billion fromCHF6.65 billion, falling across most divisions but increasing in internationalwealth management.  

Net revenues in the global markets division fell to CHF973million from the year-ago CHF2.42 billion, driven by challenging market makingconditions, continued mark-to-market losses and low levels of client andissuance activity. Fixed-income sales and trading revenues totaled CHF262million, down 82% year over year, while equity sales and trading revenuesdeclined 29% to CHF563 million.

The division's pretax loss amounted to CHF635 million,compared to year-ago pretax income of CHF842 million.  

Net revenues in the Swiss universal bank fell to CHF1.32billion from CHF1.35 billion, while those in Asia-Pacific declined to CHF894million from CHF1.09 billion. Investment banking and capital markets revenuestotaled CHF369 million, a year-over-year fall of 8%.

Net revenues in international wealth management rose toCHF1.11 billion from CHF1.07 billion a year earlier.

Group net interest income decreased to CHF2.01 billion fromCHF2.15 billion in the first quarter of 2015. Commissions and fees alsodeclined over the period, to CHF2.68 billion from CHF2.98 billion. The bankbooked trading losses of CHF271 million, compared to trading revenues ofCHF1.39 billion a year earlier.

Credit Suisse booked a provision for credit losses of CHF150million, up year over year from CHF30 million.

The group's Basel III phase-in common equity Tier 1 ratiostood at 13.6% at March-end, compared to 14.3% at 2015-end and 13.8% at the endof March 2015. The look-through CET1 ratio stood at 11.4%, unchanged from theend of 2015 and up from 10.0% at the end of March 2015.

Credit Suisse said that during the first quarter, itachieved, on an annualized basis, more than half of the CHF1.4 billion of netcost savings it is targeting for 2016, which it considers a "vitalstep" to "strengthen Credit Suisse's resilience and increase ourability to remain profitable through the economic cycle." The cost savingstarget includes a headcount reduction of 6,000 by 2016-end, with 2,000 from theglobal markets division.

Credit Suisse booked CHF255 million of restructuringexpenses in the quarter, having booked no such expenses in the year-ago period.Total operating expenses, which include the restructuring costs, reachedCHF4.97 billion, down 3% from CHF5.11 billion in the first quarter of 2015.