Credit Suisse in market warning

CREDIT Suisse today sounded the alarm over market conditions by warning that the rest of the second quarter could see a 'considerable' slowdown in client activity.

Reporting results for the first three months of the year, Switzerland's second-biggest bank said there was likely to be a decrease in business volumes at least until July.

'The group expects market conditions to improve in the second half of 2005,' it added.

The gloomy forecast comes just a day after Swiss rival UBS disappointed the City by revealing a 19% fall in profits at its investment banking arm for the first quarter.

Credit Suisse posted net income of Swfr1.91bn (£847m) for the quarter to 31 March, narrowly up on the Swfr1.86bn reported last year and ahead of many analysts' expectations.

But it relied on private banking and wealth management to make up for sluggish results from Credit Suisse First Boston's institutional securities business, where revenue in equity trading, debt underwriting and advisory fell.

Chief executive Oswald J Grubel insisted, however: 'With solid revenues and good net income, Credit Suisse has made a strong start to 2005. Private banking had another excellent quarter and corporate and retail banking reported a record result.'

Net income at the group's private banking arm surged 11% to Swfr685m.