Credit Suisse reports pre-tax loss of CHF 522 mn in FY21, impacted by the Archegos matter, goodwill impairment and litigation provisions. On an underlying basis*, the bank posts pre-tax income of CHF 6.6 bn
Highlights for the fourth quarter of 2021
Net revenues were down 12% year on year, impacted by a reduced risk appetite across the Group in 2021, a negative impact on our franchise momentum and a return to a more normal trading environment after the exceptional conditions that prevailed for most of 2020 and 2021. This was most evident in the Investment Bank, largely due to our exit1 of Prime Services and the strong comparable performance in 4Q20, but our Wealth Management-related businesses also saw a reduction in transaction-based revenues. The pre-tax loss of CHF 1.6 bn compared to pre-tax loss of CHF 88 mn in 4Q20, included a goodwill impairment of CHF 1.6 bn relating to DLJ and major litigation provisions of CHF 436 mn, partly offset by real estate gains of CHF 224 mn.
Reported pre-tax loss of CHF 1.6 bn for 4Q21, compared to a reported pre-tax loss of CHF 88 mn in 4Q20, predominantly driven by the previously announced goodwill impairment of CHF 1.6 bn taken in the quarter mainly relating to the acquisition of DLJ that was completed in 2000. We took major litigation provisions of CHF 436 mn in 4Q21, part of our progress towards addressing legacy issue.
On an adjusted basis, excluding significant items and Archegos*, 4Q21 pre-tax income of CHF 328 mn, down 62% year on year
On an adjusted basis, excluding significant items and Archegos*,net revenues were down 18% year on year, impacted by the cumulative effect of our reduced risk appetite during the year, more normal trading conditions and client deleveraging
NNA of CHF 1.6 bn compared to CHF 8.4 bn in 4Q20 across the Group, driven by NNA in AM of CHF 4.7 bn and in IWM of CHF 2.7 bn partly offset by net asset outflows in APAC of USD 3.2 bn (CHF 2.9 bn), which includes client deleveraging and de-risking measures we have taken, and in SUB of CHF 1.7 bn
Strong capital base, with CET1 ratio at 14.4% as of the end of 4Q21, stable compared to the end of 3Q21 and improved Tier 1 leverage ratio at 6.2% as well as CET1 leverage ratio at 4.4%; capital and leverage ratios benefitting from reductions of RWA and leverage exposure
Continued progress on remediation work on the Supply Chain Finance Funds (SCFF) matter. Returning cash to investors remains a priority; total cash paid out and current cash and cash equivalents of approximately USD 7.2 bn as of December 31, 2021
Highlights for the full year 2021
Stable net revenues with increased net revenues in the Wealth Management-related businesses, partially offset by a net revenue decrease in the Investment Bank, due to the loss related to Archegos and the cumulative impact of our reduced risk appetite in 2021 as well as our exit2 of Prime Services. We had a pre-tax loss of CHF 522 mn compared to pre-tax income of CHF 3.5 bn in FY20 due to the impact of the Archegos matter, the cumulative impact of our more conservative risk approach in 2021 and a goodwill impairment of CHF 1.6 bn, taken in 4Q21; additionally, the bank took major litigation provisions of CHF 1.1 bn in FY21.
Net loss attributable to shareholders of CHF 1.6 bn, compared to net income attributable to shareholders of CHF 2.7 bn in FY20
Reported pre-tax loss of CHF 522 mn, down significantly year on year, compared to pre-tax income of CHF 3.5 bn in FY20; FY21 included gains made on our equity investment in Allfunds Group of CHF 602 mn as well as gains on real estate sales of CHF 232 mn. Results in FY21 were affected by the impact of CHF 4.8 bn relating to Archegos, CHF 1.6 bn in the form of a goodwill impairment, CHF 1.1 bn relating to major litigation provisions, a CHF 113 mn impairment related to the valuation of our non-controlling interest in York Capital Management and CHF 103 mn of restructuring costs
On an adjusted basis, excluding significant items and Archegos*, FY21 pre-tax income of CHF 6.6 bn, up 51% year on year
On an adjusted basis, excluding significant items and Archegos*,net revenuesof CHF 22.5 bn, up 2% year on year, driven by higher net revenues across AM, IB and SUB, partly offset by lower net revenues in IWM
Adjusted operating expenses, excluding significant items and Archegos*,of CHF 16.1 bn, down 4%, reflecting underlying cost discipline and resulting from lower variable compensation costs, partially offset by increased professional services fees and investments in strategic initiatives, including hiring of relationship managers in APAC and hiring in risk and controls. Reported operating expensesof CHF 19.0 bn, up 7% year on year, mainly driven by the goodwill impairment taken in 4Q21 in IB and APAC, partially offset by decreased compensation and benefits
Group AuM of over CHF 1.6 trn as of December 31, 2021, up approximately 7% year on year; NNA of CHF 30.9 bn with NNA in AM, IWM and SUB offsetting net asset outflows in APAC
Wealth Management AuM of CHF 827 bn, up from CHF 795.3 bn as of December 31, 2020, with NNA of CHF 11.3 bn, supporting recurring commissions and fees’ growth of 9% year on year
* Refers to results excluding certain items included in our reported results. These results are non-GAAP financial measures. For a reconciliation to the most directly comparable US GAAP measures, see the Appendix of this Media Release.
1 With the exception of Index Access and APAC Delta One 2 With the exception of Index Access and APAC Delta One