Credit Suisse reports a sharp fall in profits in the second quarter as a result of a rescheduling of the investment bank and the billion-dollar debacle around hedge fund Archegos. This was shown on Thursday by figures from the Swiss bank.
In the last quarter, profits amounted to 253 million Swiss francs, compared with 1.2 billion francs a year earlier. Analysts were aiming for a profit of 330 million francs.
Credit Suisse reported a loss of 594 million francs in the Archegos case in the second quarter. Credit Suisse warned about this as early as April. As the hedge fund was unable to meet its margin obligations, Credit Suisse had to liquidate its positions, which resulted in a loss of 4.4 billion euros in the first quarter.
The investment bank’s revenues fell by as much as 41 percent year-on-year to 1.8 billion francs, due to a weak trading environment, a slowdown in customer activities and the bank’s measures to re-allocate the investment branch. Credit Suisse expects a continued slowdown in these activities in the current quarter.