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BUSINESSThursday 22 October 2015
Italian craftsmanship Credit Suisse to cut jobs, raise cash as profits drop
meeting Wall Street
as Ferrari goes public JAMEY KEATEN nues declined 8 percent to wealth management an- and private banking and
Associated Press 5.98 billion francs. nounced plans to issue wealth management divi-
The Associated Press GENEVA (AP) — Credit Su- Separately on Wednesday, new shares in moves ex- sions,” he said in a state-
Ferrari roared onto the isse says it plans to cut at the Swiss government an- pected to bring in over 6 ment. “This translated into
New York Stock Exchange least 3,400 jobs over three nounced long-awaited billion francs. lower profits and was par-
Wednesday and its shares, years in Britain and Switzer- rules aimed to reduce “too- Credit Suisse’s new CEO, ticularly visible in our fixed
trading under the ticker land and raise billions in a big-to-fail” risks at Credit Su- Tidjane Thiam, said the re- income sales and trading
symbol RACE, jumped new share offering after its isse and the country’s other sults “reinforce the need for performance.” Company
sharply in their public de- net profit fell 24 percent in big bank, UBS. By 2019, the a restructuring of the bank” spokesman Christoph Meier
but. the third quarter. banks must maintain a le- to reduce earnings volatility said Credit Suisse plans to
The automaker, based in The Swiss firm on Wednes- verage ratio of no more and focusing more on pri- reduce some 1,800 jobs in
the northern Italian town day reported net income than 5 percent — up from vate banking and wealth its operations in Britain and
of Maranello, had been a attributable to sharehold- a 3.1 percent requirement management clients. He another 1,600 in Switzerland
private company since its ers dropped to 779 million today. In essence, the said the results included a as part of efforts to achieve
founding in 1929 by Italian Swiss francs ($815 million), new rules require the banks “resilient performance” in 2 billion Swiss francs in cost
sports driver Enzo Ferrari. from 1.03 billion francs a to hold more capital as a its Asian business. savings over the next three
In 1969, Fiat bought a 50 year earlier, mostly be- cushion for losses. “In the third quarter, diffi- years. Most of the reduc-
percent stake in the com- cause of an “unfavorable Credit Suisse, a broad bank cult market conditions led tions in Switzerland are ex-
pany, which it then in- market conditions” in in- but which has specialized to low client activity in both pected to come through
creased to 90 percent in vestment banking. Reve- in investment banking and our investment banking, attrition, he said.q
1988.
For Fiat-Chrysler (the com- An early rally fades, leaving stocks modestly lower
panies joined last year),
the IPO raises needed cash ALEX VEIGA From left, Fiat Chrysler CEO Sergio Marchionne, Piero Ferrari, son of founder Enzo Ferrari, Ferrari
and also helps pare debt AP Business Writer CEO Amedeo Felisa, and Fiat Chrysler chairman John Elkann, gather for the ringing of a cer-
at the world’s seventh larg- U.S. stocks closed lower on emonial bell as their IPO begins trading, on the floor of the New York Stock Exchange, Wednes-
est automaker, which has Wednesday after a late-af- day, Oct. 21, 2015. Ferrari’s parent company, mass-market carmaker Fiat Chrysler Automobiles,
ambitious plans to expand ternoon slide erased mod- is floating shares under the stock name RACE.
its Alfa Romeo brand and est gains made earlier in
other higher-margin luxury the day. (AP Photo/Richard Drew)
cars like Maserati. The decline added to the
There were questions, how- market’s losses from the keep the market from slip- Investors have been re- American sales that helped
ever, about how becom- day before and came as ping into the red. viewing company earnings GM overcome $1.5 bil-
ing a public company crude oil prices fell and The Dow Jones industrial this week as they hunt for lion in costs from its deadly
might affect such an icon- investors focused primarily average fell 48.50 points, insight into how the global ignition switch problem.
ic brand. on the latest wave of com- or 0.3 percent, to 17,168.61. economy is doing. The stock gained $1.94 to
IHS Automotive, the con- panies reporting quarterly The Standard & Poor’s 500 All told, 104 companies in $35.42.
sulting firm, said some fil- financial results. index lost 11.83 points, or the S&P 500 index have re- Biogen also rose, adding
ings suggest Ferrari might Yahoo slumped 5 percent 0.6 percent, to 2,018.94. ported third-quarter earn- $10.53 to $276.34 after the
boost production from be- after reporting a sharp The Nasdaq composite slid ings so far. biotechnology said it will
tween 7,000 and 8,000 cars drop in a closely watched 40.85 points, or 0.8 percent, Some 69 percent of those cut 11 percent of its work-
per year, to 9,000 by 2019. measure of revenue, while to 4,840.12. have reported results that force and disclosed that
IHS acknowledged that it Chipotle Mexican Grill tum- The major stock indexes beat Wall Street’s expec- its third-quarter profit and
did not know if the com- bled 5.7 percent after the started trading higher early tations. That’s better than revenue topped expecta-
pany would devote any restaurant chain’s results Wednesday, but lost mo- the historic average of 66 tions.
new production to higher- fell short of Wall Street’s ex- mentum by midmorning. percent, according to S&P Some companies’ results
end models that cost well pectations. They drifted between small Capital IQ. prompted traders to sell.
in excess of $200,000 which Not all the earnings news gains and losses until the Traders cheered General Chipotle Mexican Grill lost
already exceed demand was bad. Investors bid up last half-hour of trading, Motors’ latest quarterly re- $39.96 to $665.67, while Ya-
or, like in the late 1960s and shares in General Motors, then veered lower. sults, including strong North hoo shed $1.71 to $31.12.q
early 1970s, it would again which climbed 5.8 percent,
start making lower-priced and Biogen, which rose 4
models to put the Ferrari percent, among others.
within reach of more peo- Only about a quarter of the
ple. companies slated to report
“Whatever the strategy their results have done so.
it chooses to enact, it will “As we get a fuller pic-
be keen to maintain the ture of how (third-quar-
combination of mystique ter) earnings are going to
and profit-generating abil- wind up shaking out, that
ity of this business,” said Ian will give people more of
Fletcher, an IHS analyst. a comfort level in terms of
In an interview with CNBC the directional cues in the
from the floor of the NYSE, market,” said Mike Ryan,
Sergio Marchionne, CEO chief investment strategist
of Fiat Chrysler Automo- at UBS Wealth Manage-
biles and chairman of ment Americas.
Ferrari, said he would not A roaring start to Ferrari’s
allow increased produc- market debut and news
tion to threaten the Ferrari about a couple of corpo-
tradition.q rate deals also failed to
