Credit Suisse Group AG (NYSE:CS) Q2 2020 Earnings Conference Call - Final Transcript

Jul 30, 2020 • 02:00 am ET


Credit Suisse Group AG (NYSE:CS) Q2 2020 Earnings Conference Call - Final Transcript


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Good morning. This is the conference operator. Welcome, and thank you for joining the Credit Suisse Second Quarter 2020 Results Conference Call for Analysts and Investors. As a reminder, all participants are in a listen-only mode and the conference is recorded. You will have the opportunity to ask questions after the presentation. [Operator Instructions]

I will now turn the conference over to Kinner Lakhani, Head of Group Strategy & Development. Please go ahead, Kinner.

Kinner Lakhani

Good morning. Thank you, operator. Welcome, everyone. Before we begin, let me remind you of the important cautionary statements on slides two and three, including in relation to forward-looking statements, non-GAAP financial measures and Basel III disclosures. For a detailed discussion, we refer you to the Credit Suisse second quarter 2020 financial report, other published materials and the accompanying financial statements for the period published this morning.

I will now hand you over to Group CEO, Thomas Gottstein; and our Group CFO, David Mathers, who will run you through the numbers and strategic initiatives.

Thomas Gottstein

Thank you, Kinner. Good morning, everyone. Thank you for joining our call this morning to discuss our second quarter 2020 results, my first full quarter since becoming Group CEO on the 14th of February.

Before I start with the slide presentation, allow me to make a few remarks. Our first priority was and remains the safety and well-being of our employees, clients and communities in which we operate around the world. I want to thank all our roughly 48,000 employees for what they have achieved over the last few months in very difficult circumstances as evidenced by our second quarter 2020 figures today showing the highest second quarter net income attributable to shareholders in a decade and double-digit return on tangible equity. I also want to thank my colleagues on the Executive Board and on the Board of Directors for their partnership, which allowed us to deliver on our primary objective: providing solutions to our clients around the world and helping them navigate extremely volatile markets amid intense economic uncertainty.

Let me now take you through the slide presentation. Today, I will take you through some of the highlights of the second quarter 2020 and then explain the strategic initiatives we announced earlier today to improve effectiveness and generate efficiencies for further investments in digitalization as well as to accelerate growth as a leading wealth manager with strong global investment banking capabilities.

Let's turn to slide five. In the second quarter, we generated CHF1.6 billion in pretax income, up 19% year-on-year, and CHF1.2 billion of net income attributable to shareholders, up 24% year-on-year and the highest second quarter result in a decade. Our second quarter growth was supported by 11% year-on-year growth in revenues with a strong contribution from our Global Markets, Investment Banking and APAC Market franchises and solid performances in our Private Banking businesses. The increase in net income for the group was achieved despite adding CHF296 million in additional provision for credit losses last quarter for a total of CHF864