Credit Suisse puts 2000 jobs at London headquarters at risk with new strategy

Almost 2000 jobs are at risk at Credit Suisse’s investment banking headquarters in Canary Wharf after new chief executive Tidjane Thiam set out his strategy concentrating on wealth management and private banking.

Credit Suisse also launched a combined share placing and rights issue to raise Swfr6 billion (£4.1 billion) of new capital which Thiam said “will allow us to be in control of our own destiny”.

The news came as third-quarter pre-tax profits fell from Swfr1 billion to Swfr779 million, missing analysts’ forecasts of Swfr858 million.

The fall was blamed on “deteriorating market conditions”.

Investment banking made an unexpected loss of Swfr125 million down from Swfr516 million profit the preceding quarter and Swfr615 million profit a year earlier.

The bank said it would “right-size” the investment bank to concentrate on its activities on supporting wealth management clients and seeking higher profitability with lower capital needs and less volatile earnings.

Asked about the future for London, Thiam said: “We have 6600 jobs, 2400 front office, 4200 back office.

“Out of the 4200 about 2400 are directly connected to the front office so they need to be co-located with the front office.

“The other 1800 frankly don’t need to be in London and that’s the potential we’re looking at plus a little bit of efficiency in the front office.”

He said the bank would also cut around 1600 jobs in Switzerland over the next three years.

The aim is to cut costs by an extra Swfr2 billion a year. Credit Suisse also said it would float its domestic Swiss bank during 2017.

Thiam said: “The ambition in this strategy is to grow fundamentally. To grow and to resolve the capital issue for good.”

He also announced a major shake-up of the executive board with four of the 13-strong board standing down.