It appears that European banks are not faring very well during the coronavirus pandemic. Recently, Deutsche Bank has had to ask its top managers to voluntarily forego a month’s pay as a means of offsetting the bank’s mounting financial hardship. Now, Credit Suisse Group AG is following a similar path, except they are planning to only keep a small portion of its workforce after the pandemic.
According to an interview on the Swiss newpaper NZZ, the Suisse Bank’s CEO Thomas Gottstein is planning to downsize operations in a post-pandemic word, citing the mounting efficiency in streamlining banking processes. Given that a large portion of everyday banking can be done online, he is planning on having bank employees work from anywhere between 10% to 20% of the time, and will not need as many employees as the pre-pandemic era.
Furthermore, the financial recovery from the pandemic may have a long road ahead, consisting of an over-supply of banking services. As such, Gottstein stated he will make it a priority to reduce office space as well in a bad sign for commercial real estate holders. Although the bank started the year off strong, given the extent of the pandemic’s economic impact, Credit Suisse will most likely experience hindered growth and potential credit defaults.
The Credit Suisse Group employed 48,860 people globally as of the end of 2019.
Information for this briefing was found via Banking & Finance. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
