Credit Suisse shareholders can only dream of this right now: Despite the bad environment with high inflation, falling stock markets and rising interest rates, the other major Swiss bank UBS offers strong results, earning more than CHF 1.7 billion in July and September. That’s less than a year ago, but in CS it’s much more than expected: On the other side of the parade, there should also be a loss in the third quarter, it will be the fourth in a row.
In response, UBS boss Ralph Hamers (56) lauded his bank’s “highly capitalized business model” in a press release for quarterly results. He is confident that UBS can “continue to deliver attractive and sustainable returns to shareholders.”
UBS costs under control
CS had been looking for a business model like this for months. Not only does it cost money, but it generates so much revenue that the end result can still be a profit.
Keyword costs: These fell six percent on UBS in the third quarter. In CS, the situation is the opposite. “The costs in CS will continue to rise because there will be deferred bonus payments this year,” says Andreas Venditti, 50, Vontobel bank analyst.
Another figure at UBS makes you sit down and pay attention: In asset management, UBS’ core business, the bank received CHF 17 billion in new money. In CS, it’s more about keeping funds from flowing out in a critical situation.
The crisis in CS was reflected in the share price
If that’s the case, they certainly won’t result in UBS. “In conjunction with the strong inflow of new money in UBS, no direct conclusion can be drawn regarding the exit in CS. This is an estimate at best,” explains Venditti. Zürcher Kantonalbank analyst Michael Klien (45) adds: “A client in CS hardly moves to another large Swiss bank. But more often to a cantonal bank or a foreign competitor.”
The stock market gives an idea of two major banks: UBS shares have lost only eight percent since the beginning of the year, while CS shares have lost 47 percent. The bottom line: Since the beginning of October, the CS share has rebounded significantly. So shareholders seem hopeful that the bank’s senior management, headed by Chairman Axel Lehmann (63) and CEO Ulrich Körner (59), will present a credible plan on Thursday for how CS can emerge from the crisis again.
Christian Kolbe
Source :Blick
I’m Tim David and I work as an author for 24 Instant News, covering the Market section. With a Bachelor’s Degree in Journalism, my mission is to provide accurate, timely and insightful news coverage that helps our readers stay informed about the latest trends in the market. My writing style is focused on making complex economic topics easy to understand for everyone.
