Credit Suisse announces Q4 earnings loss, to cut over 5000 jobs

Credit Suisse has reported a net loss of 2.347 billion Swiss francs ($2.337 billion) for the fourth quarter of 2016 as the bank felt the impact of a $5.28 billion fine from the U.S. Department of Justice.

The fine in December stems from the bank's sale of toxic mortgage assets in the lead up to the 2008 global financial crisis and brings an end to a "major source of uncertainty" for the bank, according to Chief Executive Tidjane Thiam. It said Tuesday it recorded a provision of approximately $2 billion during the fourth quarter of 2016 for this penalty, in addition to existing provisions of $550 million in prior periods.

The average estimate in a Reuters poll of seven analysts was for a net loss of 2.013 billion francs in the quarter. For the whole of 2016, the bank reported a net loss of 2.438 billion Swiss francs, versus a 2.944 billion Swiss franc loss in 2015.

The bank did achieve full-year net cost savings of 1.9 billion Swiss francs ($1.89 billion), it said, ahead of projections set out by the bank in its overhaul strategy. It also stated that it will cut 5,500 jobs over 2017, on top of the 7,250 positions it cut last year, as it strives to reach its cost-cutting target by 2018.

Credit Suisse's shares fell by over a third in the first quarter of 2016 but, under Thiam's stewardship, the lender raised approximately CHF 6bn in capital since 2015.

"We believe we are well positioned to continue to make progress with our restructuring programme in 2017 and 2018," the Credit Suisse boss said in a statement.