Credit Suisse has written almost 1.5 billion off the value of its asset-backed investments and suspended some traders after finding pricing errors on its books.
The bank said the writedowns would wipe at least $1 billion from its first-quarter net income, after taking into account tax credits and cancelling some staff bonuses, but it still expected to stay in profit for the quarter.
The writedown and mismarking errors are the latest in a string of shocks from global banks, including huge new subprime-related exposures at rival UBS and the trading scandal exposed last month at Societe Generale .
The revelation came a week after the bank announced fourth quarter net profit of 623.4 million pounds, and trimmed its subprime-linked writedowns for 2007 to CHF2 billion, less than the charges so far this year unveiled on Tuesday.
Unlike UBS, which has been hit by $18 billion of charges, and some major US banks such as Citigroup and Merrill Lynch, Credit Suisse had until now been relatively unscathed by the credit crisis.