Credit Suisse investment bank and Archegos
On Thursday, after Credit Suisse reported its earnings, investors understood how aftershocks from scandals (related to the Archegos and Greensill) were seen across its investment bank.
Analysts expect flagship wealth business of Credit Suisse to take the stream of markets that helped private bankers make higher earnings out of the rich people.
However, some other analysts expect an almost $600 million hole caused by more losses on fund Archegos and additional weakness in its trading businesses.
That will indicate a sharp slide after competitors feel the benefits of a jump in dealmaking and an economic recovery.
The second-biggest bank of Switzerland decided to cut risk after its top brokerage business lost more than any other competitor. It resulted from the collapse of Archegos, with its asset management division which struggles to return around $10 billion of client investments connected to finance company Greensill.
Those scandals inspired organizational changes and regulatory investigations, while changes and bonus cuts at its investment bank helped deal-makers in the United States.
According to public reports by Reuters, Credit Suisse lost a dozen bankers on the trading side and more than 45 bankers in its advisory business.
The main focus
The departures mainly focused on its advisory business across the United States and its high-growth in Asia.
Gains in the investment banking system helped UBS increase by 63% net profit.
According to Refinitiv data, in July, Credit Suisse moved to seventh place in the list of global M&A leagues, which resulted in losing ground to European rival Barclays.
The data shows that in Europe, investment banking fees dropped to $215 million. It gave it a tenth placement in regional league tables, which is way too much lower than a year ago when it earned $356 million in fees.
In the meantime, more minor wealth management Julius Baer revealed plans to start offering M&A advisory services to its customers as it published record assets under management.
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