Corporate Press Release

Press Release

Credit Suisse announces increased mortgage-related litigation provisions

Credit Suisse today announced that it has increased its mortgage-related litigation provisions by CHF 277 million subsequent to the disclosure of the bank's preliminary 2014 results on February 12, 2015.

Developments in industry-wide litigation and investigations in the United States relating to mortgages have resulted in an increase in provisions relating to this issue subsequent to the disclosure of the bank's preliminary 2014 results on February 12, 2015. Credit Suisse is obliged, under accounting standards, to assess the impact this new information has on its financial position and results for 2014. Developments that materially affect the bank’s legal provisions must be considered and, if necessary, reflected in the 2014 results if they become known before the financial statements are finalized.

Based on these developments and accounting requirements, Credit Suisse increased its litigation provisions for 4Q14 by CHF 277 million. Adjusting the preliminary financial results announced on February 12, 2015 for this charge, the reported 4Q14 net income was CHF 691 million, compared to a net loss of CHF 476 million in 4Q13. For the full year 2014, making the same adjustment, reported Core pre-tax income was CHF 3,232 million, compared to CHF 3,504 million in 2013, and reported 2014 net income attributable to shareholders was CHF 1,875 million, compared to CHF 2,326 million in 2013. Given that the increase in litigation provisions was recognized in the non-strategic unit of the Investment Banking division, there is no impact on Credit Suisse’s strategic Core pre-tax income for 4Q14 and full-year 2014, which remained at CHF1,449 million and CHF 6,790 million respectively.

Credit Suisse’s Look-through Basel III CET1 ratio was 10.1%, and the Basel III CET1 ratio was 14.9% as of the end of 2014, after reflecting the charge.

Also as a result of these developments, Credit Suisse has increased its 4Q14 estimate of the aggregate range of reasonably possible losses that are not covered by existing provisions for certain proceedings for which Credit Suisse believes an estimate is possible to zero to CHF 1.8 billion (from the previously disclosed range of zero to CHF 1.3 billion).

Credit Suisse Group is due to publish its final audited 2014 financial statements as part of the Annual Report on or about March 20, 2015.

The revised 4Q14 Earnings Release, 4Q14 Results Presentation Slides and updated Time Series Data reflecting the impact of the charge are available for download at: www.credit-suisse.com/results