Today's second quarter results from Credit Suisse showed that Switzerland's biggest bank in terms of market capitalisation continues to attract money from the world's wealthy, including business-owning families and family offices, writes David Bain.
Nearly SFr12 billion of net new money flowed into the bank's core private-banking unit in the quarter, which compliments the already SFr13 billion that swelled the private bank's assets under management in the first quarter.
The second quarter new money flows might have been marginally down on the earlier quarter results, but they were against a background of volatile stock markets. This suggests Credit Suisse is still attracting money from other wealth managers, with accounts from rival UBS still moving to Credit Suisse, say insiders.
But it's not all good news for the Zurich-based bank led by American Brady Dougan. Last week, German prosecutors raided all 13 of Credit Suisse's German branches.
Understandably, Credit Suisse is downplaying this, saying that as far as the bank is concerned it didn't do anything wrong. German prosecutors could yet get tough with the Swiss bank if they find anything suspicious. (Continue reading here)
And this could scare some of the wealthy away just as the argument with the US authorities over tax matters did for UBS.
The effect of the German episode on Credit Suisse current successful money gathering efforts won't be known until its third and fourth quarter results come out later this year.
But Credit Suisse will be hoping that its status as a favourite place for the wealthy to deposit their money – built up during the tough years of the credit crisis and since – doesn't go awry in the second half of the year.
Picture: Credit Suisse head office in Zurich
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