C Suisse to move quick to scale back businesses

Honey I Shrunk The Banks


Reuters reports that Credit Suisse is stepping up efforts to scale back riskier fixed income areas squeezed by strict new regulation, it said on Tuesday.

The move reinforces a push by the Swiss bank to spread risk taking more evenly between its two main units, private banking for the wealthy and investment banking.

Credit Suisse wants the private bank to eventually account for half of the group's risk-weighted assets, against around a third currently.

The bank said in October it would create units for activities it plans to exit within both its private banking and investment-banking divisions to accelerate the reduction of costs and capital deployed.

Bloomberg News reports that at the investment-banking division, Credit Suisse plans to shrink its rates business, which focuses on government bonds and interest rate swaps and options, to improve returns. In cash products, it will focus on high-volume electronic trading, while the derivatives business will be geared toward simplified products.

'The whole point of the non-strategic units is to run them off as quickly as possible', Chief Financial Officer David Mathers said on a conference call Tuesday. 'The faster we can reduce, the better, and quite clearly there has been increasing focus among regulators around leverage exposure'.

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