Credit Suisse will struggle to shed sub-par UBS tag

London

CREDIT SUISSE looks like a cut-price UBS. Can it do better? The fresh strategy from new chief Tidjane Thiam goes some way towards closing the Swiss bank's valuation gap with its cross-town peer. Credit Suisse will raise 6.05 billion Swiss francs (S$8.8 billion) in equity and become a wealth manager first and foremost. What's needed next to shake off the invidious comparison is growth.

Mr Thiam's approach, unveiled on Oct 21, is right. UBS rejigged its strategy back in 2012 and its shares now trade at a 30 per cent premium to forward book value, versus a 10 per cent discount at Credit Suisse. And Mr Thiam's third-quarter results showed the need to cut fixed-income trading: revenue fell 42 per cent year-on-year, more than at any Wall Street institution.