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Credit Suisse to ax 2,000
August 31, 2000: 7:18 a.m. ET

After $11.5B DLJ deal, bank boss cites overlap in admin, infrastructure
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LONDON (CNNfn) - Credit Suisse Group Chairman and Chief Executive Lukas Muehlemann said Thursday the Swiss financial services firm will cut about 2,000 jobs following its $11.5 billion purchase of U.S. investment bank Donaldson, Lufkin & Jenrette Inc.

"Two thousand jobs are likely to be lost," Muehlemann said, largely in overlapping areas of infrastructure and administration such as in the U.S. stock business. He was speaking at a news conference as Credit Suisse aired its results for the first half of the year.

Credit Suisse would make its decisions on job cuts, which would fall most heavily in New York and London, in the next couple of weeks, he added. DLJ currently employs about 26,000 people, while Credit Suisse has 66,000 staff.

Profit up 35% in first half

Word of the cuts, which many analysts had been expecting, came as Switzerland's second-largest financial-services provider said net profit rose 35 percent to 3.6 billion Swiss francs ($2.1 billion) in the first half of the year. Analysts had expected profit of about 3.65 billion francs.

The private banking division, Credit Suisse's biggest revenue generator, posted a 61 percent increase in net profit to 1.4 billion francs.

Revenue rose 29 percent to 17.8 billion francs, but operating expenses kept pace with that growth, rising 28 percent to 11.7 billion francs. The firm said that was largely due to performance-related staff bonuses, which rose 51 percent to 4.3 billion francs.

Credit Suisse said it planned to take a restructuring charge of about $850 million this year as a result of the DLJ purchase, which it expects to be earnings enhancing after 2002.

"There is considerable momentum, which we intend to maintain, and I think DLJ is going to give us another boost here," Muehlemann said.

Group assets under management slipped back to 1.227 trillion francs at the end of June from 1.234 trillion Swiss francs at the end of March. Back to top

-- from staff and wire reports


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