The Swiss business of Credit Suisse reported a net profit of 648 million Swiss francs ($672 million) in the first half of the year, an improvement from the 625 million francs profit compared to the same six months of last year, it announced in a statement on Friday. Today's publication of the Financial Report follows its earnings release from July 27.

Supply Chain Finance

Credit Suisse said that in the first half of the year, the supply chain finance funds (SCFF) matter «did not have a material impact on the financial results of Credit Suisse (Schweiz)».

As the bank reported previously, the boards of four SCFFs decided to suspend redemptions and subscriptions in the relevant funds to protect investors and terminate the SCFF to proceed to liquidation.

The Swiss unit said it continues to analyze the situation along with external counsel and other experts. It noted that certain clients have threatened the firm with litigation and as the situation develops «Credit Suisse (Schweiz) may become subject to litigation, disputes or other actions».

Russia Exposure

During the first half, the firm reduced its exposure to Russia further. After specific allowances and provisions for credit losses and valuation adjustments, Credit Suisse (Schweiz) had net credit exposure to Russia of 43 million francs, down from 242 million as of December 31, 2021.

The remaining credit exposure continues to be subject to ongoing monitoring and management. Credit Suisse (Schweiz) AG notes that these recent developments may continue to affect its financial performance, including credit loss estimates and potential asset impairments.

Strategic Review

The strategic review which the parent company announced in July along with new cost-cutting CEO Ulrich Koerner, did not get any updates in the Swiss unit's interim report. Investors will have to wait for third-quarter results when Credit Suisse will provide an update along with the results.

Still, several announcements have been made by the parent company since then. In particular, Frances McDonagh who is the new COO, and Michael Bonacker who will head the cost transformation group. That both are proven cost cutters might give some insight into what is to come with the update. 

Capital Distribution

On August 25, the board of directors proposed a 300 million francs distribution to come out of capital contribution reserves, to be approved by an extraordinary general meeting of shareholders on August 29.