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Credit Suisse pension business down amid 3% growth

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SWITZERLAND – Credit Suisse Group’s pension-related business including asset management and insurance, has recorded a down-trend in the first quarter of 2005 in spite of the group recording a 3% net income growth.

The Group’s net income amounted to CHF1.9bn (€1.2bn) for the first quarter of 2005, compared to CHF1.8bn in the first quarter of 2004 but revenues from Credit Suisse Asset Management, CSAM, part of the Wealth & Asset Management segment, amounted to CHF 471m( €305.5m) down from CHF483m of the same period last year.

The Wealth & Asset Management segment received net new assets inflow of CHF5.4bn, with CSAM contributing CHF1.6bn, due to the launch of a new real estate fund.

Net income for the whole segment, which is in turn part of the First Boston division, amounted to CHF135m ,a decrease of CHF1 m, or 1%,compared to the first quarter of 2004.

The bank said it was due to “lower revenues from Credit Suisse Asset Management
and Private Client Services, as well as lower investment-related gains”.

Net revenues for the segment, however, were up 8% in the first quarter compared with the same period in 2004.

Institutional Securities, also part of the First Boston division, reported net income of CHF540m, a decrease of CHF83m, or 13%, compared to the first quarter of 2004,

Credit Suisse First Boston as a whole recorded net income of CHF675m, down 11% compared to the first quarter of 2004, but up 103%compared to the fourth quarter of 2004. Net revenues, CHF4.5bn, were down 5% from the first quarter of 2004.

The bank’s Insurance arm, Winterthur, recorded a “solid performance “during the first quarter resulting in a net income of CHF251m. Its Life &Pensions segment however reported net income decrease of CHF13m, or 9%.

“Life &Pensions achieved a strong start in the newly introduced second pillar pension business in Slovakia, achieving the number one position in the market” Credit Suisse said. A spokesman for the group told IPE that the group was still considering a market floatation for Winterthur, but added there was “no pressure and no hurry”

He pointed out that in the first quarter the insurer showed signs of re-gaining profitability.

The report also mentioned that as of March 31, CHF156m have been paid to its Swiss and international pension plans. The group said in its financial statement for 2004 that it would commit CHF618 m in 2005.

Credit Suisse Group said it has received the requisite regulatory approvals from the Swiss Federal Banking Commission to merge its two Swiss banks: Credit Suisse and Credit Suisse First Boston. The merged bank will be operational from May 16, but will continue to use the Credit Suisse, Credit Suisse First Boston and Credit Suisse Asset Management brands.

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