Credit Suisse Investment Bankers Set to Take Home Higher Bonuses
(Bloomberg) -- Credit Suisse Group AG’s investment bankers are set for higher bonuses, with those in other divisions likely to see flat or lower payments after the overall pool for discretionary pay was cut.
The Swiss bank -- which posted a fourth quarter loss of 353 million francs ($393 million) after hits related to U.S. legal cases and a hedge fund impairment -- reduced the bonus pool by about 7% for last year, Chief Financial Officer David Mathers said on a conference call. Payments will be better-than-expected for some bankers, after Bloomberg had previously reported that Credit Suisse was considering reducing the pool by at least 10%.
Chief Executive Officer Thomas Gottstein echoed comments of executives at rival lenders such as Deutsche Bank AG by signaling that Credit Suisse needed to pay for performance and that it would increase bonuses at the investment banking unit. The division profited from the boom in initial public offerings and blank check companies in the fourth quarter, helping compensate for lackluster trading results.
Credit Suisse’s overall bonus pool for 2019 was reduced by 1% from a year earlier to 3.17 billion francs, and stayed flat the previous year.
The bank posted a narrower-than-expected fourth quarter loss of 353 million francs ($392 million), compared with analyst estimates for a loss of about 529 million francs. Credit Suisse saw better-than-expected results across key divisions, while loan loss provisions of 138 million francs were also lower than forecast.
©2021 Bloomberg L.P.