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Credit Suisse Plans to Restructure its Business to Revamp its Deteriorating Financial Health

Industry: Investments and Asset Management
Current: Company Performance

Credit Suisse suffered continued losses in the third quarter of 2022
Credit Suisse intends to raise $4 billion in capital to implement its turnaround strategy and revamp the business operations
As part of a cost-cutting strategy, Credit Suisse wants to shrink its employee count from about 52,000 to 43,000 by 2025

Credit Suisse is Witnessing Continued Losses Resulting in Tumbling Investor’s Faith

Credit Suisse witnessed a continuous decline in its net income in the second quarter of 2022. The net loss increased from CHF 273 million in Q1 2022 to CHF 1,593 million in Q2 2022. Furthermore, the net margin declined from -27.53% in Q1 to -80.68% in Q2 2022.

Furthermore, shares of the conglomerate have dropped more than 51% in the last year, caused by a series of errors, including the collapse of hedge fund Greensill Capital and multibillion-dollar losses caused by the failure of hedge fund Archegos Capital.

The growing losses and missteps caused investors to lose faith in Credit Suisse, forcing the company to devise new strategies to re-establish itself in the market.

Credit Suisse is Developing Radical Measures to Return to Profitability

Credit Suisse is developing strategies to overcome the mounting losses through a restructuring strategy. The company plans to restructure its investment banking business through newly raised funds. Credit Suisse has already raised approximately CHF 1.5 billion for 9.9% of the company’s shareholding. The company is further planning to strengthen its Wealth Management and Swiss Bank franchises with improved capabilities in asset management markets.

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