Credit Suisse has reported a profit fall of 72% for the final quarter of 2007, with the firm’s asset management division the worst affected, The New York Times Reports.
Net income dropped to 1.33 billion Swiss francs ($1.2 billion) following writedowns of 1.3 billion Swiss francs on debt and leveraged loans. The asset management division saw profits fall by 30% compared with 2007, down to 354 million Swiss francs, while net revenues fell by 10%.
“Our asset management division reported a loss in the quarter, reflecting valuation reductions from securities purchased from our money market funds. However, before these valuation reductions. Asset Management continued to perform well, particularly in alternative investments,” says Brady W Dougan, CEO, Credit Suisse.
Credit Suisse also recorded total income of 8.55 billion Swiss francs in 2007, up 3% from 2006.
Unlike UBS, which is predicted to report a record loss when it releases its results tomorrow, Credit Suisse says its investment banking operation continued to report a profit. Profit from wealth management rose 20%, and that from corporate and retail banking increased 21%.
Credit Suisse says it increased its cash dividend for last year, to 2.5 francs a share from 2.24 francs a share. In Zurich trading on Tuesday, the stock rose 2.5%, to 57.5 francs.
Credit Suisse says it had reduced the value of its holdings of commercial mortgage bonds to 25.9 billion francs as of 31 December, from 35.9 billion francs.
It also reduced leveraged loans to 36 billion francs from 58.6 billion and residential mortgages to 8.7 billion francs from 16.3 billion.