Credit Suisse CS -1.51% has spent the past couple of years focusing on what it could control and worrying less about what it couldn’t: that approach is bearing fruit.
The Swiss bank’s cost cutting is its main route to better profits, which hit their best quarterly level at the start of this year since the second quarter of 2015, just before Tidjane Thiam became chief executive.
This focus makes it less reliant on what it can’t control: markets and clients’ fickle attitude to trading. Some of its big European rivals, in contrast, are struggling to cut costs or hoping revenue recovery will help them out—or at Deutsche Bank , both.
At the same time, Credit Suisse is increasing the recurring fees it charges rich clients around the world—a more solid, dependable sort of revenue. Total revenue in international wealth and at its Asia arm grew 21% and 15% respectively versus last year in dollar terms. Credit Suisse took in more new money and sold more high-margin products to existing customers.
That’s a good thing as markets and investment banking, which still make up half of total revenue, disappointed. In equities trading, the bank looks to have lost further market share—its revenue globally was up about 7.5% in dollar terms over the first quarter last year, which compares with 24% at UBS and almost 40% for some big U.S. banks.
Business also suffered among Credit Suisse’s private-equity clients, because market volatility disrupted deal making. Across the bank, revenue from advisory work and underwriting fees was down about 1%, which was slightly better than U.S. rivals on average but far behind UBS’s 21% growth in dollar terms.
Credit Suisse’s real boost came from cost cuts, saving 10% across the group since the first quarter of two years ago, when restructuring really began.
There is work to do: return on equity was a lowly 6.7%, although that is its best quarter since before Mr. Thiam arrived and better than any annual return since it made 15% in 2010.
So long as it keeps squeezing more juice out of the world’s wealthy, Credit Suisse looks on the right track.
Write to Paul J. Davies at paul.davies@wsj.com