Credit Suisse Swings to Loss in Fourth Quarter -- Update

By Brian Blackstone 

ZURICH-- Credit Suisse Group AG swung to a wide loss last quarter due to a hefty settlement the Swiss banking giant agreed to pay to resolve crisis-era mortgage securities cases.

Zurich-based Credit Suisse said Tuesday that its net loss was 2.3 billion Swiss francs ($2.3 billion), versus expectations of a 2.04 billion franc loss according to a consensus of analyst estimates compiled by the bank. During the same quarter of 2015, Credit Suisse posted a heftier loss of 5.8 billion francs due to restructuring costs associated with its pullback from investment banking.

For 2016 as a whole, Credit Suisse posted a loss of 2.4 billion francs.

In December, the bank reached a settlement worth roughly $5.3 billion with the U.S. Justice Department over toxic mortgage securities sold before the financial crisis. This included a $2.5 billion penalty and consumer relief payments of $2.8 billion over the next five years.

The fourth-quarter results included net litigation expenses of 2.2 billion francs, reflecting the settlement with U.S. authorities. The agreement removes "a major source of uncertainty for our future," Credit Suisse Chief Executive Tidjane Thiam said in a statement.

Its revenue for the quarter was 5.4 billion francs, and totaled 21.6 billion francs for 2016, a 7% drop from the previous year.

Write to Brian Blackstone at [e-mail]

(END) Dow Jones Newswires

February 14, 2017 02:13 ET (07:13 GMT)

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