Credit Suisse is wrapping up its investor day and - like Deutsche Bank - it has some fuzzy feelings about 2021.
We already highlighted the extent to which Credit Suisse and Deutsche will be chasing the same bankers next year: both banks are interested in hiring advisory (M&A) bankers focused on healthcare and technology. Both banks are after environmental, social and corporate governance (ESG) professionals. Naturally, both are hiring technologists.
This doesn't mean that cost-cutting is over. Credit Suisse still wants to take more than $100m in costs out of its investment bank in 2020, even allowing for an investment of around $70m in the transition away from LIBOR. When it hires, therefore, it wants new recruits to pay their way. Any hiring that's going on will be "self-funded within our growth initiative," said Brian Chin, CEO of global markets, today.
Chin said Credit Suisse already has some of these hires underway. "The advisory business is definitely an area we're looking to grow," said Chin today, noting that tech and healthcare bankers are top of the shopping list. "We are actively hiring in that space." - Some new hires have already started. More will start next year.
Credit Suisse's fixed income trading division underperformed the market in the first nine months of this year by virtue of its comparatively small exposure to the booming macro trading business. Next year, however, Chin said the Swiss bank should be far better positioned: CS should benefit from its strength in securitization and leveraged finance as credit markets normalize. It should benefit too from growth in the GTS business which offers its investment banking products to wealth management clients and which already accounts for 18% of revenues in the investment bank. - Clients will have more need structured solutions in a negative interest rate environment, said CFO David Mathers.
"Next year we will likely see a better fit for our business mix," said Chin, who's also (optimistically) predicting strong financing growth as the pandemic subsides. "We feel like the market's 'comin to us."
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