Credit Suisse chief executive Thomas Gottstein has put managing the fortunes of the world’s wealthiest at the heart of the bank’s strategy, as he tries to draw a line under a testing first 10 months in the job.
The Swiss bank said on Tuesday that it planned to increase profits from its wealth management business by at least a quarter by 2023 through initiatives that would cost up to SFr150m.
In a strategy update to investors, Mr Gottstein, who took on the job in February following the messy exit of his predecessor Tidjane Thiam, outlined his main areas of focus for the next three years.
Alongside wealth management, they include building up the bank’s trading and investment banking business and achieving a return on tangible equity of 10 to 12 per cent.
“2021 is the new era for Credit Suisse where we want to go into offense and we want to grow,” Mr Gottstein told the Financial Times. “This has to be all done with discipline across risk, compliance and cost.”
The 56-year-old has had a gruelling introduction, taking over just as the pandemic gathered pace. Several of the fires Mr Gottstein has been forced to fight relate to the period before he became chief, notably the corporate spying debacle that led to the departure of Mr Thiam.
Finma, the Swiss regulator, in September escalated a probe into the affair, shaking the country’s normally staid financial sector.
At the height of the pandemic in the spring, Credit Suisse was caught up in scandals at Luckin Coffee and Wirecard, having worked on deals for both. The Swiss bank also launched an internal review over its supply chain finance funds linked to SoftBank and Greensill Capital.
With Swiss regulators giving banks permission to resume dividend payments, Credit Suisse said on Tuesday that it would increase its dividend by 5 per cent per year and restart a SFr1.5bn ($1.7bn) share buyback plan.
Its investment bank had performed well in the fourth quarter, Credit Suisse said, with revenues expected to be higher than in the same period a year earlier.
Mr Gottstein also insisted that asset management was still a priority for the group. In September the bank announced a review of the asset management business in response to several setbacks for the division.
“2020 was a difficult year because we had on one side one-offs like York and some underperformance,” Mr Gottstein said, adding the bank had a “clear plan to go back to significant growth” in asset management.
“There are potential opportunities for us to make acquisitions in that area. We will be opportunistic about that, but it’s not the basis of our strategy,” he said. “This is an organic growth story.”
But the lender stressed that its fourth-quarter results would be marred by a $450m writedown on its holding in York Capital Management, the US investment group that announced it was winding down its European hedge fund business last month.
Credit Suisse’s share price has rebounded in recent weeks and shares were up 0.5 per cent in early afternoon trading, taking their gain to almost 30 per cent since the end of October. However, they remain down 15 per cent this year.
Next year Mr Gottstein will be joined by Lloyds Bank chief executive António Horta-Osório, who will become chairman of the Swiss bank.
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