Tidjane Thiam on the best and worst jobs at Credit Suisse in Asia

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Tidjane Thiam on the best and worst jobs at Credit Suisse in Asia

On the face of it, Credit Suisse had a so-so quarter in Q1 in Asia. As we reported in our analysis of the bank’s results last week, bonuses fell for Asia-based investment bankers and traders on the back of declining year-on-year revenues in their teams.

But the raw numbers don’t tell the full story about jobs at Credit Suisse in Singapore and Hong Kong. Speaking at the results presentation last week, CEO Tidjane Thiam and CFO David Mathers provided some further insights into Credit Suisse careers. Here’s what you need to know.

Get to know Yves-Alain Sommerhalder

Earlier this month Credit Suisse appointed veteran banker Yves-Alain Sommerhalder to head up a new International Trading Solutions (ITS) team in APAC, a unit which has been running globally for two years and which sells markets products to wealth management clients. ITS has produced a “flow of landmark transactions” internationally and Thiam is now “excited” to replicate this success across Asia. Sommerhalder appears to be a rising star in the region. Thiam describes him as “one of our most experienced managers with deep knowledge of the Asian client base across both investment banking and wealth management”.

Equities might actually be a good team to work in

Revenue in Credit Suisse’s Asian Markets unit decreased 12% to CHF289m in Q1, mainly because of a decline in equity sales and trading. “Discretionary compensation expenses” (i.e. bonuses) were also cut in Markets. But Thiam said CS is faring well against other banks – it’s already a “top-five equity player in Asia”, and is expected to gain market share in Q1 as it moves up Asian league-table rankings and becomes more profitable.

Avoid working in loans

If you’re a Credit Suisse private banker who’s heavily reliant on arranging vanilla loans (as opposed to more complex financial products) for your clients, you might still be in for a rough ride in 2019. Ditto if you work in loans settlements. The net interest income the bank is receiving from loans in Asia has been on the decline since last year because of “sustained deleveraging” by clients, reflecting the economic environment, said CFO Mathers.

There will be opportunities in structured credit

“We can do more in structured credit in Asia than we've been doing. We used to have a strong position, which we lost, but [that’s] relatively easy to rebuild,” said Thiam, adding that he can see “opportunities across the board to have a better nine months”.

Mixed signals in private banking

Credit Suisse’s Asia-based private bankers aren’t making as much money as they were a year ago. First quarter revenues for the private bank in Asia were down 13%, primarily because of a slump in transaction-based revenues. But – as Thiam was at pains to point out – Asian assets under management rose 10% year on year to CHF219bn (their highest ever level), despite a “difficult market”. This bodes well for the long term – if you’re a CS private banker you might not want to jump to a competitor.

Very strong…but not very, very strong

March was “very strong”, said Thiam, referring to the bank’s overall performance in Asia and adding that there’s an “improving trend” in the region which is carrying on into Q2. But, he warned, the second quarter of 2018 was “very, very strong”, so a year-on-year comparison may still not be flattering when the bank’s Q2 results come out.

You could be working in a different “universe”

How strong will CS be in Asia for the rest of the year? That’s going to depend partly on market sentiment, said Mathers. More specifically, he warned that Asian deal flow for the bank will to some extent be determined by the US-China trade dispute. There will be two “completely different universes”, depending on whether the dispute is resolved or not.

Image credit: stockwerk

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