Credit Suisse posts 2016 net loss of $2.3 bn

ZURICH: Credit Suisse, Switzerland’s second-biggest bank, said on Tuesday it booked a net loss of 2.4 billion Swiss francs (2.2 billion euros, $2.3 billion) in 2016, after agreeing to a massive settlement with the US authorities last month over its role in the so-called sub-prime crisis in 2008. Credit Suisse said in a statement that its net loss was narrower than a year-earlier figure of 2.9 million Swiss francs.

“2016 was the first full year of implementing our new strategy and it was a challenging and busy 12 months,” said chief executive Tidjane Thiam.

“We have significantly reduced our fixed operating cost base and increased our operating leverage.”

Last month, the US authorities announced a $5.28 billion settlement with Credit Suisse over its role in the sale of the kind of toxic securities that led to the global financial crisis of 2008. Federal prosecutors say Credit Suisse has admitted that between 2005 and 2007 it knowingly deceived investors in the sale of complex securities derived from residential mortgages.

The system-wide failure of such securities in 2008 caused a cascading wave of bankruptcies and crises that touched off the Great Recession, which cost tens of millions of jobs around the world.

“We have reached an agreement with the US Department of Justice on the ... matter, thus removing a major source of uncertainty for our future,” CEO Thiam said on Tuesday. — Reuters