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BANK

Trial over Swiss franc loans opens in Croatia

A trial began Wednesday of eight banks accused by a Croatian consumers group of failing to inform clients taking out loans in Swiss francs that currency fluctuations could prompt an increase in repayments.

Trial over Swiss franc loans opens in Croatia
Gabriela Schaufelberger

The Potrosac association filed a collective suit against the banks, demanding that the hard-currency clause in Swiss francs be abolished and substituted with a clause in euros, lawyer Nicole Kwiatkowski told AFP.

However Zagreb commercial court judge Radovan Dobronic ordered the plaintiff to provide more details on each of the eight banks’ policies within the next 60 days.

Around 125,000 people in Croatia have taken out loans denominated in Swiss francs, 60 percent of which were housing loans.

Due to a rise in the value of the Swiss franc and changes in interest rates, some of their loan installments have even doubled in the last few years.

Most of the banks in Croatia stopped granting loans in Swiss francs in 2008.

Croatia’s central bank (HNB) monetary policy is based on maintaining fluctuations of the local currency kuna exchange rate against the euro within a stable range.

However the exchange rate between kuna and Swiss franc depends on fluctuations of the exchange rate between euro and the Swiss franc.

Local media estimated that the trial could last up to two years.

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BANK

Credit Suisse slashes jobs, branches to move ‘online’

Credit Suisse, Switzerland's second-biggest bank, said Tuesday it would reorientate its domestic services towards digital banking, with a quarter of its Swiss branches to close and hundreds of jobs at risk.

Credit Suisse slashes jobs, branches to move 'online'
A Credit Suisse branch. Photo: FABRICE COFFRINI / AFP

“In the last two years alone, use of online banking at Credit Suisse has grown by approximately 40 percent, while the use of mobile banking has more than doubled,” the bank said in a statement.

“The COVID-19 crisis has further accelerated these trends. In contrast, the number of visits to branches has been declining for years.

“Credit Suisse will introduce a new digital offering and a future-oriented branch concept at the end of October.”

The bank also plans to merge the activities of regional subsidiary Neue Aargauer Bank with those under the Credit Suisse brand to avoid duplication.

READ: How to open a bank account in Switzerland 

With its realignment, the bank intends to reduce annual costs by around 100 million Swiss francs ($110 million, 93 million euros) from 2022 onwards. It plans to cut the number of bank branches from 146 to 109.

Meanwhile up to 500 jobs could be axed, Andre Helfenstein, head of the bank's operations within Switzerland, told reporters during a conference call.

The restructuring costs are expected to be 75 million Swiss francs. “Digitalisation is happening all around us,” Helfenstein said in a statement.

“The changes we are making to our branch network — while simultaneously investing in digital solutions and in advisory services for clients with more complex needs — represent a logical step forward.”

In late July, the bank's new chief executive Thomas Gottstein unveiled his plans for Credit Suisse, which involved regrouping its different investment bank activities.

Gottstein took charge in February after Tidjane Thiam was ousted over a massive spying scandal.

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