Credit Suisse gets nod for Irish branch

By Money Times

Dec 28, 2015 09:44 AM EST

Credit Suisse has received regulatory approval for opening its new branch in Ireland. The Swiss bank is setting up a new branch in Dublin as part of its cost reduction exercise. Credit Suisse is restructuring its securities trading and prime brokerage operations. Credit Suisse is in the process of meeting capital requirements and improving shareholder returns.

The Switzerland's second biggest bank Credit Suisse has decided to shift some of its brokerage operations from London office to Dublin. The Swiss bank may shift 100 employees to Dublin from its London office.  For the first time a non-European Union (EU) bank to receive approval for setting up banking operations in Ireland.

The new branch in Ireland will be part of Credit Suisse's subsidiary. Before 2013, non-EU banks were allowed to set up full subsidiaries in Ireland and would be under local regulation control, as reported by The Irish Times. After the changes in rules, non-EU banks are allowed to set up operations as part of subsidiary only.

Credit Suisse lends securities and cash to hedge funds and settle trades as part of its prime brokerage services. The Swiss bank has decided to move 40 traders and 60 back-office staff moving from London to Dublin. The Swiss bank is planning relocate some its staff to take care of some part of prime business. 

Bloomberg further reports that the Zurich-based bank would slash 2,000 jobs in London as part of its restructuring plan. The bank will strengthen back operations in prime services by end of the year. Sofia Rehman, a spokeswoman at Credit Suisse, said in an e-mail that "the Irish capital will become the primary hub for prime services business within Europe. Dublin offers an attractive operating environment for our business from the perspective of talent pool, infrastructure and efficiencies."

In addition to prime brokerage operations, the Swiss bank is also moving its some general support functions and IT operations also. Of late, the bank has been facing pressure on margins. It has taken up an overhauling exercise to enhance profitability.

According to Swiss Info, Tidjane Thiam, Chief Executive, Credit Suisse, took the charge in early 2015 and has started overhauling brokerage and securities trading operations. The bank aims to enhance returns to shareholders and meet stringent capital requirements.

In last February 2015, Credit Suisse announced it plans on restructuring and enhancing profitability. The stock rose after the announcement. The restructuring plan includes enhancing leveraging ratio, which indicates capital against assets.

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