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Credit Suisse suffers first losses in eight years


Tough times: Tidjane Thiam

Tough times: Tidjane Thiam

Tough times: Tidjane Thiam

Credit Suisse confirmed it started the year with a quarterly loss for the first time since 2008 after suffering "some of the most difficult markets on record".

The Swiss banking giant reported a loss of 484m Swiss francs (£344m) for the first quarter, against pre-tax profits of 1.5bn Swiss francs (£1.1bn) a year earlier after client activity "drastically reduced" during market turmoil in early 2016.

It marked the bank's worst first-quarter performance since the height of the financial crisis and comes as it leads a major restructuring to slash costs, including axing around 6,000 jobs.

Tidjane Thiam, chief executive of Credit Suisse, said there had been "tentative signs of a pick-up" in March and April, but warned that trading would remain tough.

He said: "In the first quarter of 2016 and particularly in January and February, we operated in some of the most difficult markets on record, with volumes and client activity drastically reduced.

"Subdued market conditions and low levels of client activity are likely to persist in the second quarter of 2016 and possibly beyond." He said the company's priorities were to progress with cutting costs and headcount, deliver strong growth in wealth management divisions and keep a strong capital position.

"We have been able to make good progress in all of these areas against an extremely challenging market backdrop," he said.

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Credit Suisse shares bounced back by nearly 6% despite the first quarter blow as the losses were smaller than feared, while the bank has already said that reorganisation costs were expected to push it into a loss for the first quarter.

Mr Thiam joined in July last year from insurer Prudential and has been spearheading a revamp to cut costs and refocus the group on private banking and away from investment banking.

The bank said it was making "good progress" on its overhaul, accelerating job cuts with more than half - 3,500 - of the roles already gone.

It has cut more than 1,000 jobs in its global markets business since late March alone and said more than half of its 2016 target to cut annual costs by 1.4bn Swiss francs (£1bn) was made in the first quarter.

Credit Suisse revealed in February that it slumped to a full-year pre-tax loss of 2.4bn Swiss francs (£1.7bn) - its first annual loss since 2008.