Credit Suisse plans to repurchase 2 billion to 3 billion Swiss francs ($ 2 billion to 3 billion dollars) in shares over the next two years and increase dividends, expressing confidence that its strategy is working after a painful restructuring.
Switzerland’s second-largest bank has confirmed its commitment to distribute half of the company’s net income to shareholders, especially with repurchases or special dividends, offering a welcome treat for investors who have had to endure sharp declines in stock prices during the three-and-a-half year mandate. chief executive officer Tidjane Thiam.
Focusing on asset management for the wealthiest in the world, particularly the wealthiest entrepreneurs in Asia, Credit Suisse hopes to increase profitability, despite challenges such as unstable markets and risk aversion among the most fortunate investors.
“We think the strategy is working,” Thiam said on Wednesday in a meeting with London bank investors. “The actions were taken during the restructuring mean that the bank is more resilient in the face of market turmoil.”
Credit Suisse expects to achieve a pre-tax profit of 3.2 billion to 3.4 billion francs in 2018, reaching annual profit for the first time since 2015.
The goal is to increase earnings in the medium term, confirming its target of 10 to 11 percent return on tangible assets to 2019, surpassing 12 percent by 2021, against 6 percent expected for this year.
The company plans to increase its dividend by at least 5 percent per year from 2019.
The bank closed the restructuring program this month, cutting costs by reducing riskier investment banking activities, cutting funding costs, closing down non-strategic businesses and cutting thousands of jobs.
Shares have lost almost half the value since Thiam, former chief executive of insurer Prudente, took over the bank’s management in July 2015, dropping almost 56 percent compared to the 38 percent drop in the European banking index.