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Credit Suisse forced to address restructuring concerns

Credit Suisse CEO Ulrich Körner
Credit Suisse CEO Ulrich Körner has been appointed to steer the troubled bank into calmer waters. Keystone / Salvatore Di Nolfi

Troubled Swiss bank Credit Suisse has sought to quieten rampant speculation about its upcoming strategic revamp following leaks to the media and concerns of its staff.

The bank is due to announce restructuring details when it announces its third quarter earnings results on October 27.

On Monday Credit Suisse took the unusual move of issuing a statement ahead of its planned strategic review update next month, mentioning a “high level of media and market speculation”.

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“The bank is currently executing on a number of strategic initiatives including potential divestitures and asset sales” in an effort to reduce costs and become more “agile”.

Credit Suisse said it has not ruled out seeking further funds from the markets to boost its capital base.

Switzerland’s second largest bank is under enormous pressure following a series of scandals, legal cases, mounting losses and deals turned sour. Recently installed CEO Ulrich Körner has been tasked with turning around the bank’s fortunes with the share price falling to around CHF4, which is less than the price of a coffee in many Zurich cafés.

But the bank’s efforts to keep restructuring details secret until next month appear not to be working.

It has been widely reported that Credit Suisse is poised to slash up to 5,000 jobs and the Financial Times detailed leaks of a plan to break up its investment banking business.

Senior executives reportedly sent a memo to staff at the weekend, seeking to ease jitters amid the rumours and a share price slump.

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