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Swiss Bank dives pounds 980m into the red

Jill Treanor
Wednesday 18 September 1996 18:02 EDT
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Swiss Bank Corporation will declare a SFr1.9bn (pounds 980m) loss in 1996 after SFr3.3bn of extraordinary charges to cover bad debts, a revaluation of its property portfolio and an extensive restructuring to cut costs, writes Jill Treanor.

The bank said yesterday that sweeping changes in Switzerland would lead to 1,700 job losses among 13,000 in its domestic arm. SBC, Switzerland's third largest bank and the owner of London-based investment bank SBC Warburg, said it would not pay a dividend but instead would make a capital repayment of SFr10 next year. It described the loss as "technical" and said it expected to make a group operating profit of SFr1.4 bn in 1996 against SFr1.05bn in 1995.

But that profit will not be enough to outweigh the charges it will be forced to take this year. SBC is writing off SFr2.4bn bad debts and re- valuing its property portfolio at cost of SFr900m. The balance is the cost of restructuring.

The clean-up of the accounts prompted speculation that the bank may be preparing to list itself in New York.

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