Credit Suisse Discussing Cost-Sharing Deal, Thiam Says in FTby
Credit Suisse Group AG, Switzerland’s second-largest lender, is in talks with another bank about ways to work together and cut costs, Chief Executive Officer Tidjane Thiam told the Financial Times.
The discussions, which include potentially sharing databases and servers, are at an early stage, Thiam told the newspaper, without naming the potential partner. Zurich-based Credit Suisse confirmed the comments.
“There’s a lot more we can do” on costs, Thiam told the FT.
Credit Suisse may announce more details on cost-cutting plans at an investor day in December, Thiam said, as banks struggle to boost earnings amid negative interest rates and tightened capital regulations. UBS Group AG similarly said on Friday that it’s in talks on cost-sharing with other lenders.
“There are ways in which you try to create economies of scale,” UBS CEO Sergio Ermotti said in an earnings presentation on Oct. 28. The cost dynamics and expenses for regulation are “something that needs to be addressed in an industry manner. So, I’m very convinced that it’s something that you will start to see in three to five years,” he said.
Credit Suisse plans to cuts costs by 4.3 billion francs ($4.35 billion) by 2018 to below 18 billion francs annually.
Since taking over in July 2015, Thiam has been seeking to reverse a slide in shares that has eroded about 35 percent of the bank’s market value this year. Credit Suisse had made about 4,800 jobs cuts out of a planned 6,000 this year, as of Sept. 27.
In the trading division there are ways to cut costs in the “middle and back office end of a value chain,” Thiam said last month.