Credit Suisse Announces Another 6,500 Layoffs After Reporting 2016 Loss

Tyler Durden's picture

After Credit Suisse reported yet another significant loss for the full year 2016, amounting to 2.35 billion Swiss francs, more than the CHF2.07bn expected, the Swiss banking giant said it was looking to lay off up to 6,500 workers and said it was examining alternatives to a planned stock market listing of its Swiss business.

"We're setting a target now of between 5,500 and 6,500 for 2017," Chief Financial Officer David Mathers said in a call with analysts on Tuesday after the bank published earnings. The bank did not specify where the extra cuts would come but said this would include contractors, consultants and staff, Reuters reported.

For the fourth quarter, Credit Suisse reported a 2.35 billion franc net loss, largely on the back of a roughly $2 billion charge to settle U.S. claims the bank misled investors in the sale of residential mortgage-backed securities.  Despite the loss, Credit Suisse proposed an unchanged dividend of 0.70 francs per share, in line with market expectations.

CEO Tidjane Thiam, who took over at Switzerland's second biggest bank just over 18 months ago, is shifting the group more toward wealth management and putting less emphasis on investment banking. As part of his turnaround plans, the bank is looking to cut billions of dollars in costs and cut a net 7,250 jobs in 2016 with more to follow this year.

Additionally, Credit Suisse said it was still preparing sell 20-30% of its Swiss business in an initial public offering but left the door open to alternative options to strengthen its balance sheet. It said a flotation depended on market conditions and board approval. "So we will continue as planned our preparations for an IPO in the second half of '17," Thiam told analysts on the call. "That said, we will also continue to analyze the evolution of our regulatory environment which is key in this and, as we always do, continuously examine a broad range of options to determine if there are ways to reach a more attractive risk/reward outcome for our shareholders."

Aside from the "one-time charge", the bank's other results showed a modest improvement. "Capital ratios were much better than expected. On a divisional level, results in IWM (International Wealth Management) and IBCM (Investment banking and Capital Markets) were better than expected," Vontobel analyst Andreas Venditti, who has a "hold" rating on the stock, wrote in a note.

Still, just like Deutsche Bank, in wealth management, Credit Suisse said it suffered net outflows in the fourth quarter due to clients pulling cash to participate in tax amnesty programs and a decision to drop certain external asset managers. Offsetting that, however, the bank said all its wealth management divisions had seen positive inflows year to date. At the end of the fourth quarter, Credit Suisse's common equity Tier 1 capital ratio, an important measure of balance sheet strength, was 11.6 percent, down from 12 percent in the third quarter but ahead of market expectations.

The bank's shareholders greeted the news of fresh layoffs, sending the stock 3% higher in early trading.

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TheytookERjobs's picture

"The bank's shareholders greeted the news of fresh layoffs, sending the stock 3% higher in early trading." Of course.

Government needs you to pay taxes's picture

Worked there once, and recall an M&A MD saying, "They'll never fire us.  We (First Boston) are their crown jewel".  The guy had a knack for hysterical one-liners . . . I was once in his presence where some German-speakers were casually walking thru the lobby.  He quipped: 'They want their gold back' (Nazi gold reference).  The travesty is that the ones who make the most obscene amounts are the ones who never really get fired, like that CFO quoted in the clip.  Just like the general ordering fresh troops to become cannon fodder, I bet that fucker whistles on his way to work every day, particularly on days when his pen ends the (misguided) career dreams of >5000. Eleven Madison Avenue: Where Nazi gold is still at work, plus where dreams come to die, unless you are adept at financial buggery.

Jubal Early's picture

"The Swiss = Alpine Nazis."

If only that were true.  Unfortunately the Swiss, like the allies, sided with the zionists and helped lose the world for white christians.

Here is likely the real story, where CS has paid out $344 million in lawyers fees for the last 5 quarters alone to pay for (((Neil Barfsky))) and a team of 50 (((Jenner & Block Lawyers))) to go through their books looking for Holocaust nightshades and Nazi soap, and hidden taxes.  This does not include their per-diem expenses at the finest hotels and restaurants in Zurich, or the best offices on Paradeplatz in downtown Zurich.  

Ufortunately, an israeli kike pulled a fast one on CS and claimed he was living the Israel when he was really living in the US.  So now CS will be forced to pay for a couple of more years of jew blood letting.  Its been going on for millenia, that is why the tribe absolutely owns the IRS (Schulman, Koskinen, Lerner, and on and on).

If you stupid Yankees haven't figured it out yet, you are nothing more than the Shabbez Goy strong arm for the zionists as they plunder the entire planet through extortion, blackmail, terrorism, drug running, and most of all child trafficking 

Addendum:  I know for a fact from IT connections that these (((lawyers))) not only demand a completely isolated sub-network inside the bank with multiple servers and specialty software, they also demand root access to any bank server they choose to plant their CIA spy software under the cover of searching for nazi gold, holocaust survivors, and things like that.

Jubal Early's picture

I love this (translated) comment from here:

"Barofsky does not even consider ending his audit. He has been made a lottery winner twice. Since 2014 he sacked 25 million for himself and his 70 lawyers month after month. Month for month. In the CS Galleria in Opfikon, they have been nesting for a long time. Hermetically sealed. The bank must show at any point what the Amis (Jewmericans) demand. 70 hostile Ami lawyers in the middle of the CS. Dozens of transatlantic flights weekly in Business and First Class. Everything at the expense of shareholders. No matter what it costs.

And superpractical: No one in the CS is responsible for it!
It just seems stupid!

Hello wake up: the cash hemmorage is going on 24/7, nonstop since 2014, is that arrived, yes?
To 25 million per month! And no one is responsible for it?

At the same time, an employee received the blue letter just before the 30th anniversary. One could now make save labor costs in Poland. While you are opening up to the gray-haired coworker, just 4 Barofsky Boys sit high above the North Atlantic in the first class and can still add some champagne to the crystal kohlchen. They have the hottest time of their lives. And cared for their children's children.

A cheer to the generous, silent CS shareholders."

One also has to remember that CS's CEO is Tidjane Thiam, a black man who is likely a major CGI contributor.

slasherNJ's picture

I wouldn't be too sure about the layoff thingy.

Let me give you some inside perspective from CS. I used to work there (for 2 years) and left recently.

The Investment Bank is a effed up operation. It is run by Prima Donnas who can't hold a candle to Goldman but act as if they are one.

The IT operations are 90% outsourced to India and cannot get anything done other than maintaining old code. The Indian operators milk them for every useless body they throw at CS. the 10% of IT that is staying in NY and London just pretend to manage the Indian operators and in many cases are in cahoots with them for lots of freebies which I cannot name. Many of them will be in Jail if CS was really serious about the level of collusion between the Indian IT operators and the CS IT Managers who supposedly manage them.

There is a bigger picture to Credit SUisse that NO CEO has grasped yet. SO let me lay it on their thick heads.

When CS was flying high during the 2007 golden era, they had revenues of about $48b and an employee base of about 48K.

Then the 2008 Financial crisis hit and in 2009, their revenue base got cut in half (to $24b) while they announced a massive 10,000 employee layoff. Guess what 2 years later, their employee base still hovered around 45-47K. So revenues get cut in half, but the Indian IT leaches and the Investment Banking / PWM employees all stay in their bubbles and mint money.

Then 2012-14, CS rebounded and pretended to make money. Revenues barely jumped above $25-26b but they kept hiring employees.

Today after several thousands layoffs and cost cuts, Bloomberg reports that CS employes "about 47K" people.

So EVERY CEO IN CS HISTORY IS AN A**HOLE AND A JACKASS. To pay them millions while they can't understand even basic Math, is the sad reason why Credit Suisse keeps sinking towward irrelevance.

I would like to be corrected by someone who is in CS currently. :-)

Oh, and by the way, my 47K headcount does not include the 10K or so Indian IT "contractors" which has barely budged in the last 8 years.  Read and weep.

SlasherNJ

Jubal Early's picture

I have IT consultant friends at CS and I agree with everything you say.  They will go down hard when the SHTF.

Calculus99's picture

The stockmarket can be cruel.  

Big layoffs announced - stock rises. 

halcyon's picture

Good riddance. More swiss money-laundering-scumbags working for corrupt officials and inside trading traders get the boot.

Honest work can make people honest. Even bankers can learn that.

 

Handful of Dust's picture

I hope the Klinton Krime Family laundering won't be affected by the layoffs.....

That'd be awful.

angry_dad's picture
angry_dad (not verified) Handful of Dust Feb 14, 2017 9:49 AM

the foundation  has already laid off a  few people  as they don't have any influence to sell 

we'll have to wait for crooked to write another story book

 

Last of the Middle Class's picture

The "sagging" effect of QE wind down. Funny, though, is actually bullish for the middle class when these thieves in suits lose their jobs.

Handful of Dust's picture

It's the swiss version of "Everything is awesome."

Gazooks's picture

the thieves are the execs still getting a check and their bonus..

 

.. these are just schlep clerks, cafeteria and janitorial workers.

venturen's picture

One Goldman to Rule them all..Goldman's use of the FED to destroy all competition is working to plan!

zippy_uk's picture

"You know all those losses we did not make in 2007/8, well..."

Ban KKiller's picture

LIED about mortgages and the fact that the chain of title was destroyed? No shit.

yogibear's picture

Yellen can follow Bernanke's Marxist plan, buy everything plan.

Another form of nationalization. 

Bingo Venezuela!  Eventually crowds starving.

What a grand future Yellen (Bernanke's Plan) and the Federal Reserve has in store for us.

buzzsaw99's picture

wealth management = front running and skimming the muppets' money operation.

Jubal Early's picture

I have had dealings with more than one wealth manager who does not meet your rigid equation.

onedb1's picture

Thiam is useless. He was hailed as some sort saviour when he isn't and will never be.  18 months of pathetic performance for Credit Suisse . The stock has halved since he started. Great job 

Jubal Early's picture

He was heralded into office in exactly the same fashion that Barry Sortero was.  The same people put both of them in.  And Mugabe.  And Zuma.  Gee, I wonder what they all have in common?

Seasmoke's picture

Who knew that these 6500 workers, were what was keeping the stock price down. 

GRDguy's picture

Who need workers when you can make so much money holding AAPL stock?

16,124,998 x 133.29 = $2,149,300,983.42 Feb 13th, 2017 Close

16,124,998 x 115.82 = $1,867,597,268.32 Dec 30th, 2016. . $281,703,715.10 Paper Profit YTD. . Not bad for 1 1/2 months.
angry_dad's picture
angry_dad (not verified) Feb 14, 2017 9:46 AM

who needs all of these worker bees????

banking is the industry that can be 100% converted to robots and algos

burger flippers, not so much

silverer's picture

Paper is paper, boys. Somewhere, someplace, somebody has to do REAL work for anything tangible to happen. As the real work and real productivity declines across the world economy, your paper will just become worthless and blow away. It's happening now. Go home and plant a garden, like that guy in Greece that lost his programming job a few months back. He's 35 and lives with his grandmother now. He had to do it. You can get a jump on your garden and start early, before you HAVE to do it.

gregga777's picture

The fictional US SEC (US Swindler Enabling Commissars) approved non-GAAP revenues and earnings used by the CCCC (Criminal Crony Capitalist CONporations) worked just fine fooling the naive suckers, I mean, the naive investing public. But, non-GAAP revenues and earnings didn't fool their CCCC (Criminal Crony Capitalist CONporations) counter-parties. The CCCC (Criminal Crony Capitalist CONporations) counter-parties are turning against each other and that's forcing them to open to reveal the true state of affairs in their scams, I mean, businesses. The CCCC (Criminal Crony Capitalist CONporations) using non-GAAP numbers to conceal their slide towards inevitable bankruptcy goes far beyond IBM, Sears & K-Mart, Toshiba and Credit Suisse.

ROTFLMAO (rolling on the floor laughing my a** off).