Credit Suisse Says Bank to Meet Regulations, Post ROE of 15%
Credit Suisse Group AG (CSGN), Switzerland’s second-biggest bank, will meet new regulatory standards while generating “best-in-class” returns for shareholders, Chief Executive Officer Brady Dougan said.
“Our view is that we will meet our risk-weighted asset requirements, we will meet all our capital ratio requirements” and “drive a business which meets our target return on equity, which is above 15 percent,” Dougan said in an interview with Bloomberg Television in Hong Kong today.
Credit Suisse, based in Zurich, and larger Swiss rival UBS AG (UBSN) are under pressure from the nation’s regulators to meet capital requirements that go beyond those faced by international competitors. Credit Suisse said in November that it plans to shrink its total risk-weighted assets 23 percent to 285 billion Swiss francs ($313 billion), a reduction Dougan reiterated today.
“If we can make 15 percent-plus returns on equity, we’ll be a best-in-class business model among financials,” said Dougan, who has led Credit Suisse since 2008.
Speaking after a trip that included stops in India, Singapore, Australia, Tokyo, Seoul and Beijing, the CEO said the bank sees “some very good opportunities to build businesses” in the region, including in private and investment banking, fixed income and equities.
Credit Suisse fell 2.1 percent to 26.04 francs at 10:27 a.m. in Zurich trading, giving the company a market value of 31.9 billion francs.
Dougan said the lender’s decision to reduce its workforce early last year has put it in a good position to be “offensive” as markets recover. The bank announced about 3,500 job cuts in 2011.
“That’s obviously a tough thing to go through” as it impacts people, Dougan said. “But we do think we did a very good job on that. We actually cut the cost base a lot and put ourselves in a really good position coming into this year.”
Dougan also said the bank has seen “good performances from all of our businesses” in Asia in the first quarter, including more activity in both the “secondary market, particularly in fixed income, but also some of the primary activity” such as mergers and acquisitions.
“We’ll see how we finish up the quarter, but hopefully that will continue,” he said.
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