Swiss bank given boost by Citi

4 July 2008

Credit Suisse will not need to raise capital through a new share sale, a note from Citigroup analyst Jeremy Sigee has indicated.

It was also predicted that 2008 earnings at the firm would be 55 Swiss francs - down from Citi's previous forecast of 65 francs.

Moreover, earnings per share were downgraded from 2.49 to 1.47 francs - while 2009's estimate also fell from 7.24 to 6.54.

Mr Sigee commented: "We apply lower multiples to reflect the de-rating of the sector and the continued limited visibility for investment banking revenues."

He added: "[Credit Suisse] may need to deleverage over time, but should avoid forced equity raising."

Meanwhile, rival bank UBS might avoid declaring a loss in the second quarter despite being hard hit by the credit crunch, the firm has claimed.

The bank, which has written off around $38 billion in assets since the beginning of the financial crisis last year, is set to break even due to tax breaks from the Swiss government worth around $2.9 billion, Bloomberg reports.

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