Credit Suisse Takes Steep Loss After US Tax Penalty

|
July 22, 2014 8:56 a.m.
JOIN TPM FOR JUST $1

GENEVA (AP) — Credit Suisse, Switzerland’s second-biggest bank, posted a second-quarter net loss of 700 million Swiss francs ($779 million) Tuesday after paying the largest penalty ever imposed in a U.S. criminal tax case.

The steep loss contrasted sharply with the profit of 1.045 billion francs ($1.16 billion) it posted in the April-June period a year ago. It resulted in what the bank called a final settlement of the U.S. government’s case against the bank for helping wealthy Americans avoid paying taxes through secret offshore accounts.

The Zurich-based bank pleaded guilty in May to aiding U.S. tax evaders and agreed to pay about $2.6 billion to the U.S. government and regulators, allowing it to put the criminal investigation behind it.

“I want to reiterate that we deeply regret the past misconduct that led to this settlement and that we take full responsibility for it,” Chief Executive Brady Dougan said in a statement. “The continued trust and support of our clients helped us mitigate the impact of the settlement on our business.”

The bank took a charge of 1.6 billion Swiss francs ($1.78 billion) as part of its settlement over the U.S. tax evasion charges.

Credit Suisse also said it had trimmed its worldwide staff to 45,100 by the second quarter from 46,300 a year earlier, and has already cut costs by 3.4 billion francs out of a total 4.5 billion francs it plans to cut by the end of next year.

Shares of Credit Suisse AG were down more than 2 percent to 25.53 francs in morning trading in Zurich.

Comments
Masthead Masthead
Founder & Editor-in-Chief:
Executive Editor:
Managing Editor:
Senior Editor:
Special Projects Editor:
Investigations Desk:
Reporter:
Senior Newswriter:
Newswriters:
Editor at Large:
General Manager & General Counsel:
Publisher:
Head of Product:
Director of Technology:
Publishing Associate:
Front-End Developer:
Senior Designer: