(Bloomberg) -- Credit Suisse Group AG's trading business may have evaded some of the issues that hurt earnings at its Wall Street peers, but there was no such escape for the advisory unit.
The Zurich-based firm's Investment Banking and Capital Markets business posted a wider-than-expected first-quarter pretax loss of $91 million, exceeding estimates for a loss of about $10 million. Net revenue dropped by more than a third, with the bank blaming the decline on a slump in market activity.
Wall Street fees plummeted in the first quarter because of the U.S. government shutdown, geopolitical instability and investor concern over growth in corporate earnings and the economy. Credit Suisse's IBCM business, which focuses on services including M&A, debt-and-equity offerings and derivative transactions, saw large declines in both advisory and underwriting.
Earnings from equity underwriting plummeted by almost half after IPOs slowed due to the U.S. shutdown. Debt underwriting earnings declined by more than a third because of lower leveraged-finance activity. The investment bank earnings contrast with better-than-expected trading results at the global markets unit, which has had a history of disappointing investors.
To contact the reporter on this story: Dale Crofts in Zurich at dcrofts@bloomberg.net
To contact the editors responsible for this story: Sree Vidya Bhaktavatsalam at sbhaktavatsa@bloomberg.net, Ross Larsen, Christian Baumgaertel
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