Credit Suisse's new strategy includes asset sales

Possible asset sales and other divestments from the bank are being called "executions."

As part of a strategic plan that will be released next month, Credit Suisse Group AG said it is working on possible asset and business sales as a way to cut costs and get back to making money.

Credit Suisse didn't say much about divestments, but Bloomberg said that company leaders are thinking about selling its wealth management operations in Latin America, except in Brazil. People who know about the situation say that the company is also looking into deals to sell its securitized products group and is thinking about bringing back the First Boston brand name as it cuts back on its investment bank.

After a string of losses and mistakes, the lender's new CEO, Ulrich Koerner, and Chairman, Axel Lehmann, are trying to rebuild trust in the company and get it back to making money. Shares of the lender have dropped to an all-time low because there has been a lot of talk about its future and a report that it may try to get more money. In a memo sent out last week, executives tried to reassure workers without giving them a lot of information.

Credit Suisse said in a statement on Monday, "The bank is working on a number of strategic initiatives, such as possible divestitures and asset sales." The Zurich-based lender said that its review is going well and that it will keep the market informed when it reports its third-quarter results on October 27.

Credit Suisse said in June that about $100 billion worth of client assets and loans are in Latin America. This includes the company's business in Brazil, where it does a lot of investment banking. People who know about the situation have said that the changes are being thought about as part of a larger effort to cut back on activities and regions that aren't considered "core."

Even though the new strategy might change how the wealth business works, the investment bank is more likely to change the way it is built. The company has been talking to possible buyers about its securitized products group, which is a trading business with, by one measure, $75 billion in assets. The unit buys and sells securities that are backed by pools of mortgages and other assets, like car loans and credit card debts.

People who know about the situation say that Apollo Global Management Inc. and BNP Paribas SA are among the investors who want to buy at least part of it. Credit Suisse has said before that it wants to get money from outside sources for the unit, which makes money but needs a lot of capital. Executives have said they want to keep some part of the business.

Bloomberg said that the bank has also talked about giving dealmakers a stake in their unit, which could be a sign of a spinoff. Executives have been talking about bringing back the historic First Boston brand, which the company stopped using about 17 years ago. Under one plan, the US investment banking operations of the Swiss bank would get a new name.

If a rebranding was done, it would add to the idea that Credit Suisse might one day spin off or separate its investment banking unit, though people who know about the situation said there were no plans to do so right now. Credit Suisse has denied a report that said it wanted to leave the US completely.