Credit Suisse to shed more jobs, slash costs

Swiss banking giant Credit Suisse says it is aiming to cut an extra almost $1 billion in costs and slash thousands more jobs as it beefs up an ongoing restructuring programme.

Credit Suisse to shed more jobs, slash costs
Tidjane Thiam is restructuring the bank. Photo: Fabrice Coffrini/AFP

Credit Suisse's new chief executive Tidjane Thiam had in October announced a sweeping overhaul of Switzerland's second largest bank, shaving off excesses in its investment bank and refocusing on its private banking and wealth management units.

But the bank has become more ambitious since, now aiming to slash costs by 4.3 billion Swiss francs ($4.4 billion, 3.9 billion euros), up from a previous target of 3.5 billion, allowing it to drive “our absolute operating cost base below 18 billion Swiss francs by 2018″, he said in a statement.

This year alone, the bank is targeting 1.7 billion in cost savings, he said.

The group said it would accelerate the restructuring of its Global Markets activities, which it said were hard-hit by “a high and inflexible cost base (that) was exacerbated by volatile market conditions and lower volumes” in the last quarter of 2015.

The ramped-up restructuring of the unit will entail 2,000 additional job cuts, the bank said.

The bank has already slashed 2,800 jobs of a total 6,000 lay-offs planned worldwide, it said.

 “Our efforts aim at putting Credit Suisse in a position to generate capital and grow profitably in the medium and long term,” Thiam said.

“The measures we are taking to strengthen our capital base and reduce our operating costs will improve our resilience and flexibility going forward,” he said.

Credit Suisse made a loss of 2.9 billion francs last year. The bank's shares have fallen in value in recent months and are currently trading at just over 14 francs from 27 francs last summer, the Tages-Anzeiger reported.

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The Covid pandemic hit Switzerland hard, although the country's largest city has rebounded strongly.

Jobs: Why Zurich has rebounded better than other Swiss cities from Covid

Measures imposed due to the Covid pandemic, which began in earnest in February 2020, shuttered businesses across the country and pushed many people out of work. 

When most notable Covid rules were relaxed in Switzerland in mid-February 2022, the economic recovery – highlighted by a strong job market – began in earnest in 2021. 

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Nowhere was this more evident than Zurich, Switzerland’s largest and most economically powerful city. 

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Even though Zurich, along with other large Swiss cities like Geneva, Basel, Bern and Lausanne, have been hit hard by the pandemic from the employment perspective, Zurich’s labour market is now growing faster than in other urban centres.

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In September alone, it recorded 2,200 additional residents.

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In fact, according to a study commissioned by the canton in 2021, if Zurich’s economy is to continue to flourish, it will need around 1.37 million workers by mid-century.

If these vacancies will not be filled, then income, tax revenue and the financing of social security programs will be impacted.

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