Credit Suisse Posts £1bn Loss

Credit Suisse today shocked investors with the continuing depth of the credit crunch by posting a further Sfr5.3bn (£2.63bn) in write downs and a net loss of Sfr2.15bn in the first quarter - worse than expected.

The Swiss bank underlined the scale of the crisis by declaring net revenues of just Sfr3bn in the quarter, down 72%, as transactions in investment banking dried up.

The latest write downs come on top of those of Sfr3.2bn last year - which it blamed on a "handful" of City-based rogue traders - and bring its total to Sfr8.5bn. This is still some way short of the Sfr37bn racked up by tarnished Swiss rival UBS. There were also net write downs of Sfr566m in asset management.

While the bank said it had reduced its exposures in leveraged finance by 41% and in commercial mortgages by 25%, investment banking recorded a pre-tax loss of Sfr3.5bn compared with a profit of Sfr2bn a year earlier. It also recorded negative revenues of Sfr450m compared with Sfr6.6bn a year earlier.

The losses, representing a Sfr5bn turn down from the first quarter of 2007, are CS's first in five years. Brady Dougan, chief executive, said they were "clearly unsatisfactory".

But he added: "I am confident that we will continue to serve as a safe haven for clients in uncertain and volatile markets and to seize the opportunities that arise in times of market dislocation to create long-term value."

CS took some succor from the performance of its private banking division which delivered a pre-tax profit of Sfr1.3bn, with net new assets of Sfr17.1bn in the quarter. It said its tier one ratio was a solid 9.8%.