Credit Suisse doubles third-quarter profit

Credit Suisse said Wednesday it more than doubled its third quarter net profit, largely due to its wealth management activities, and despite losses in its investment bank unit. Switzerland's second largest bank said its net profit soared 108 percent in the third quarter year-on-year to 881 million Swiss francs ($888 million, 798 million euros) despite a "challenging environment".

Net revenue meanwhile swelled nine percent to 5.3 billion Swiss francs, it said. The results beat the expectations of analysts polled by the AWP financial news agency, who on average anticipated net profits of 776 million francs on revenues of 5.1 billion. But investors did not appear impressed with the results, with the bank's share price plunging by nearly 2.5 percent to 12.40 Swiss francs a piece in late morning trading as the Swiss stock exchange's main SMI index remained basically flat. During the three-month period, Credit Suisse's investment bank unit meanwhile suffered a pre-tax loss of 15 million, compared to a 70-million-profit a year earlier, as the sector was "impacted by continued challenging market conditions".

But that loss was offset by strong growth in the bank's international wealth management division, which saw its pre-tax income balloon by 43 percent to 539 million Swiss francs. "We have continued, in a challenging environment, to grow our wealth management franchises," company chief Tidjane Thiam said in a statement.

However, the bank's net profits were especially bolstered during the quarter by a one-time 327-million-franc gain linked to the reorganisation of its fund business. Looking forward, the bank also said it expected to see a "usual seasonal slowdown" in the fourth quarter of the year, as well as "headwinds from the ongoing challenging geopolitical environment."

Pointing in particular to the US-China trade wars and to uncertainty surrounding Britain's looming departure from the EU, it said it anticipated "more cautious capital expenditure and investment decisions, specifically looking forward to 2020 and 2021." Credit Suisse's results follow a quarter in which it was rocked by a spying scandal that saw a top executive resign after assuming responsibility for a decision to have investigators follow a star banker after he jumped ship to competitor UBS. An internal investigation cleared Thiam of any wrong-doing in that case.