Credit Suisse reported unexpected profit in Q3

Credit Suisse has reported an unexpected net profit of 41 million Swiss francs ($42.2m) for the third quarter. Profit fell 95% from 779 million Swiss francs in the same quarter last year, but the company beat analysts' forecasts who expected 150 million francs loss. 

It is the second consecutive quarter in which Credit Suisse has surprised the market with a profit after a rocky start to chief executive Tidjane Thiam's turnaround plan for the bank.
The bank also said its core tier 1 common equity – a measure of the amount of capital it has set aside to absorb business and market losses – rose to 12% in Q3 from 11.8% in the previous three month period.  

The Swiss bank's profit for the three months to end-September was well above the average estimate for a 120 million franc loss in a Reuters poll of five analysts.

"Looking ahead, we expect market activity to continue to be influenced by geopolitical and macro-economic uncertainty over the next several quarters and the outlook to remain challenging," said CEO Tidjane Thiam. "We still have a long way to go in our journey but we are fully mobilized to deliver in challenging market conditions on our key commitments to reduce cost, strengthen our capital base and drive profitable business growth."

The 357 million franc increase in legal reserves follows last week's disclosure by rival UBS that it had set aside an extra $417 million to cover potential penalties tied to residential mortgage-backed securities (RMBS) cases.