Swiss bank Credit has returned to profit in Q2, despite widespread predictions of a loss.
Analysts had predicted a loss of 170m Swiss francs ($172m), according to the average of five estimates compiled by Bloomberg. The CET1 leverage ratio rose by 40 basis points to 11.8% from March.
The Swiss lender, which is looking to meet or exceed CHF1.7bn in gross savings by year end, reduced costs 6% from a year ago and said it’s on track to reach its targets for 2016.
However, in comparison with Q2 last year, the bank’s net income slumped by 84% – CHF170m compared to CHF1.05bn.
In particular, the APAC division performed well with an adjusted pre-tax income (PTI) of CHF216m for the quarter, and produced net revenues of CHF337m. It achieved its highest ever level of AuM of CHF158bn during the quarter.
The bank’s three geographic divisions – Asia Pacific (APAC), Swiss Universal Bank (SUB) and International Wealth Management (IWM) – delivered profitable growth against a challenging backdrop. Net new money inflows at its three private banking divisions totalled CHF11.3bn in the second quarter.
The IWM division delivered adjusted PTI of CHF260m with net revenues of CHF1.14bn in the second quarter. It generated net news assets (NNA) of CHF5.4bn during the quarter.
The SUB division delivered adjusted PTI of CHF457m, an increase of 6% compared to the year ago quarter. Adjusted net revenues stood at CHF1.34bn, down 2% compared to the second quarter of 2015.
Credit Suisse chief executive Tidjane Thiam said: "We remain cautious in our outlook for the second half of 2016 in view of the uncertainty created by significant geopolitical and macro-economic concerns, reinforced a few weeks ago by the outcome of the UK referendum."