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Turnaround gives Credit Suisse US$1.7b income

SWISS banking giant Credit Suisse yesterday reported a first-quarter net profit of 2 billion Swiss francs (US$1.72 billion), or 1.60 francs per share, following a turnaround in its previously ailing investment bank.

The figure was better than analysts' expectations for a net profit of about 726 million francs and compared with a net loss of 2.15 billion francs in the same quarter last year.

Chief Executive Brady W. Dougan said the results "show the benefit of the measures we took last year across the bank, including cost reductions and the further strengthening of our capital position."

Credit Suisse embarked on a major cost-cutting drive last year, slashing 11 percent of its workforce in an attempt to reverse a series of quarterly losses that amount to 8.2 billion francs in 2008 - the worst loss in the bank's 153-year history.

Many of the 5,300 job cuts fell in its investment banking business, which had caused billions in writedowns for the whole group.

Pretax income for the investment bank reached 2.4 billion francs in the first quarter, Credit Suisse said.

Of the investment bank's pretax profit, 1.35 billion francs were generated in the Americas region, followed by 941 million francs in Switzerland and 505 million francs in the rest of Europe, Middle East and Africa.

Net writedowns from investments in mortgage-related securities amounted to 1.4 billion francs, the Swiss bank said.

This compares with 6 billion francs in the same quarter last year.


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