Credit Suisse posts 63 percent drop in 3Q profits

GENEVA -- Credit Suisse Group said Thursday its third-quarter net profit dropped by more than half from a year ago, hit by an accounting charge from the bank's own debt.

Switzerland's second-biggest bank posted a 63 percent decline in net profits over a year ago in the same quarter. It says it had net profits of 254 million Swiss francs ($272 million) between July and September, compared with 683 million francs ($785 million) in the comparable period of 2011.

The company attributed the decline to a pretax charge of 1.05 billion francs ($1.12 billion) linked to an accounting rule on how banks must value their debt. The rule says that when a bank's debt increases it must take a write-down because it would theoretically have to pay more to buy back its own debt on the open market.

The Zurich-based bank said in a statement Thursday before the opening of the Zurich exchange that it intends to cut another 1 billion francs in costs in 2014 and 2015, on top of 3 billion in previously announced cost-cutting measures it plans to have achieved by the end of next year.

Chief Executive Brady Dougan said the bank has "significantly cut costs and improved efficiencies" while also reducing risks and strengthening its capital cushion.

Shares in Credit Suisse closed at 21.33 francs Wednesday, down 2.6 percent since the start of the year.