Credit Suisse third-quarter net profit falls 38% as wealth unit misses

© Reuters. FILE PHOTO: Logo of Swiss bank Credit Suisse is seen in Basel

ZURICH (Reuters) – Credit Suisse Group AG (S:) on Thursday posted a 38% fall in third-quarter net profit, as a surge in investment banking failed to offset a slowdown in wealth management, while a one-off boost last year left this year’s figure looking flat.

Profit reached 546 million Swiss francs (462 million pounds) in July-September. That compared with the 572 million franc median of 17 analyst estimates compiled by the Swiss bank.

A year earlier, Credit Suisse received a 327 million franc revenue boost from the sale of its InvestLab fund platform.

In a statement, the bank said it is focused on supporting clients “through the persisting COVID-19 pandemic and the resultant economic challenges. We would expect this environment to continue to result in elevated levels of transactional and trading activity.”

Chief Executive Thomas Gottstein in July announced a broad round of cost cuts, including merging the global markets trading division and advisory-focused investment banking and capital markets unit, as his first major strategic stamp on the bank.

The newly merged investment banking unit saw pre-tax profit rise to 370 million Swiss francs, with increased trading helping equity and fixed income sales and trading surge 5% and 10%, while capital markets and advisory revenue rose 33%.

A drop in revenue at its international wealth management unit, a sore point in the second quarter, was more pronounced than analysts had anticipated.

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