Credit Suisse Restructures Operations to Cut Costs

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By Adedapo Adesanya

The Swiss bank, Credit Suisse Group AG, will merge its oil and gas banking group with the global infrastructure, utilities and renewables team as part of a broader restructuring.

The revamp, which is designed to reduce costs and improve efficiencies, will remove some of the changes brought in by previous chief executive, Mr Tidjane Thiam. It comes as his successor, Mr Thomas Gottstein, sets about putting his mark on the business almost six months after taking on the role.

Announcing the changes, which solidified the group’s global investment banking operations and combined risk and compliance oversight, Mr Gottstein said: “These initiatives should also help to provide resilience in uncertain markets and deliver further upside when more positive economic conditions prevail.”

Credit Suisse has been expanding its energy coverage for some time now. The bank believes that the latest move will help the bank bridge the gap between its different sub-sectors in energy.

It posted a 24 per cent rise in second-quarter net profit to 1.162 billion Swiss francs ($1.27 billion), overshooting the mean estimate for 700 million Swiss francs in the bank’s own poll of 17 analysts.

The changes also come at a time when a growing number of traditional oil and gas companies like European oil majors BP Plc and Royal Dutch Shell Plc are trying to transition towards renewables and other cleaner sources of energy.

“The new group will be optimally positioned to work with our clients seamlessly across the entire spectrum of energy, utilities, renewables and infrastructure while allowing us to better capitalize on opportunities for the Firm in areas such as the ongoing energy transition,” the company said.

The new energy and infrastructure group will be led by company veteran MrTom Greenberg, who co-headed Credit Suisse’s global oil and gas business, and Mr Jonathon Kaufman, who joined the bank from rival Deutsche Bank AG in 2014 and was recently appointed as head of the global infrastructure, utilities and renewables group.

Also as part of the restructuring, the group announced a new investment banking division combining its previous global markets, investment banking and capital markets (IBCM) and Asia-Pacific markets business lines.

The division will be led by Mr Brian Chin, formerly head of global markets, while Mr David Miller, who previously led IBCM, steps down from the executive board and will head the capital markets and advisory businesses within the investment bank.

The bank also followed in the footsteps of rival UBS Group AG in indicating that it may pay the second half of its 2019 dividend later this year after suspending it earlier this year because of the Covid-19 pandemic and said it plans to boost the dividend by 5 per cent annually.

A division is opening between the Swiss banks and their European counterparts on payments after the European Central Bank (ECB) asked lenders not to consider dividends until 2021.

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