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.credit-suisse Annual Review Part 1 Financial highlights 2000 Editorial

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.credit-suisse Annual Review Part 1 Financial highlights 2000 Editorial

  1. 1. 2000 CREDIT SUISSE GROUP ANNUAL REVIEW
  2. 2. PART I 2 Financial highlights 2000 4 Editorial PART II 6 An overview of Credit Suisse Group 8 Strategic review 12 Organisation 14 Financial review PART III 18 Review of business units 20 Credit Suisse Financial Services 26 Credit Suisse Private Banking 29 Credit Suisse Asset Management 32 Credit Suisse First Boston 36 Risk management PART IV 38 Our broader responsibilities PART V 44 Consolidated results 46 Income statement 47 Balance sheet 48 Off-balance sheet business 48 Selected notes to the consolidated financial statements 52 Management 57 Main offices 58 Information for investors This symbol is used to indicate topics on which further information is available on our website. Go to www.credit-suisse.com/annualreview2000/bookmarks.html to find links to the relevant information. The additional information indicated is openly accessible and does not form part of the Annual Review. Some areas of the Credit Suisse Group’s websites are only available in English. Important note Within the framework of the Swiss Accounting and Reporting Recommendations, Credit Suisse Group has changed its accounting policies in the year 2000 in order to increase the transparency for its insurance business and to align with a more interna- tionally-recognised standard. The Group’s financial statements as of 31 December 1999 have also been restated to conform with the current year’s presentation. In the tables of this publication, 1999 results will be shown in ‘previously reported’ as well as in ‘new basis’ columns. In text sections, comparisons to 1999 results are based on the previously reported figures. The Financial Report comprising the Group’s consolidated financial statements as of 31 December 2000 is available in English on the Internet. Credit Suisse Group’s Annual Report 2000/2001 will be available from 11 May 2001 in English and German. www.credit-suisse.com 1
  3. 3. CREDIT SUISSE GROUP FINANCIAL HIGHLIGHTS 2000 Change Share data 31 Dec. 2000 31 Dec.Dec. 1999 31 2000 in % Number of shares issued 300,437,990 300,437,990 272,206,488 10 Shares ranking for dividend 300,437,990 300,437,990 272,206,488 10 Average 277,775,022 271,310,760 2 Shares ranking for dividend as of 5.3.2001/31.3.2000 300,635,025 273,842,638 10 Market capitalisation (in CHF m) 92,535 92,535 86,153 7 2000 20001999 Change in CHF in CHFCHF in in % Share price (as of 5.3.2001: CHF 295) at year-end 308 308 316.5 (3) for inclusion in Swiss tax returns 312 312 302 3 year high 388.5 388,5 316.5 23 year low 293 293 212 38 Repayment of capital 1)/dividend 8 1) 87 14 1) Proposal of the Board of Directors to the Annual General Meeting on 1.6.2001. Previously Change to New basis reported previously 2000 20001999 1999 reported in CHF in CHFCHF in in CHF in % Earnings per share 20.83 15.66 19.24 8 Operating earnings per share 1) 25.98 16.07 19.65 32 Earnings per share – diluted 20.75 15.54 19.11 9 Operating earnings per share – diluted 1) 25.89 15.95 19.48 #D33 Book value per share 136.30 108.48 119.84 14 1) Excl. amortisation of acquired intangible assets and goodwill, as well as excl. restructuring provision. Share performance Market capitalisation Swiss Market Index Credit Suisse Group as of 31 December (in CHF bn) 100 400 90 350 80 300 250 70 60 200 50 150 40 30 100 20 10 0 1998 91 92 93 94 95 96 97 98 99 00 1996 1999 2000 2001 1997 Financial calendar Annual General Meeting 2001 Friday, 1 June 2001 Distribution of par value reduction Wednesday, 15 August 2001 First quarter results Monday, 21 May 2001 Second quarter results Wednesday, 29 August 2001 Third quarter results Tuesday, 20 November 2001 2
  4. 4. Previously Change to New basis reported previously 2000 1999 1999 reported Consolidated income statement in CHF m in CHF m in CHF m in % Operating income 37,231 26,644 27,870 34 Gross operating profit 12,083 7,863 9,132 32 Net operating profit 1) 7,218 4,360 5,330 35 Net profit 5,785 4,250 5,221 11 Cash flow 10,734 7,008 7,983 34 Previously Change to New basis reported previously 2000 1999 1999 reported Return on equity (ROE) in % in % in % in % Credit Suisse Group: – Reported ROE 17.7 15.6 18.2 (3) Operating ROE 1) – 21.5 16.0 18.5 16 Banking business: – Reported ROE 18.2 22.1 22.1 (17) Operating ROE 1) – 23.1 22.4 22.4 3 Insurance business: – Reported ROE 16.2 1.5 11.0 47 Operating ROE 1) – 16.6 1.6 11.1 50 – Return on invested capital (ROIC) 26.3 n/a 18.0 46 Previously Change to New basis reported previously 31 Dec. 2000 31 Dec. 1999 31 Dec. 1999 reported Consolidated balance sheet in CHF m in CHF m in CHF m in % Total assets 987,433 729,022 722,746 37 Shareholders' equity 43,522 30,683 34,368 27 Minority interests in shareholders' equity 2,571 1,154 1,747 47 Previously Change to New basis reported previously 31 Dec. 2000 31 Dec. 1999 31 Dec. 1999 reported BIS data in CHF m in CHF m in CHF m in % BIS risk-weighted assets 239,465 209,870 213,298 12 BIS tier 1 capital 27,111 24,833 28,261 (4) – of which non-cumulative perpetual preferred securities 1,102 200 200 451 BIS total capital 43,565 37,414 40,843 7 BIS ratios in % in % in % BIS tier 1 ratio Credit Suisse 7.1 6.8 6.8 Credit Suisse First Boston 2) 13.6 9.9 9.9 Credit Suisse Group 3) 11.3 11.8 13.2 BIS total capital ratio Credit Suisse Group 18.2 17.8 19.1 31 Dec. 2000 31 Dec. 1999 Change Assets under management in CHF bn in CHF bn in % Advisory assets under management 797.4 631.9 26.2 Discretionary assets under management 619.6 556.2 11.4 Total assets under management 1,417.0 1,188.1 19.3 Net new assets 53.3 41.9 27.2 Change Number of employees 31 Dec. 2000 31 Dec. 1999 in % Switzerland 28,235 27,454 3 Outside Switzerland 52,303 36,509 43 Total employees Credit Suisse Group 80,538 63,963 26 1) Excl. amortisation of acquired intangible assets and goodwill (2000: CHF 359 m; 1999: CHF 110 m), as well as excl. restructuring provision of CHF 1,074 m, all after tax. 2) Ratio is based on a total tier 1 capital of CHF 17.6 bn, of which non-cumulative perpetual preferred securities are CHF 1.1 bn. 3) Ratio is based on a total tier 1 capital of CHF 27.1 bn, of which non-cumulative perpetual preferred securities are CHF 1.1 bn. www.credit-suisse.com 3
  5. 5. EDITORIAL Credit Suisse Group in very good shape Dear shareholders, clients and technologies, including the Internet, fellow employees continues to be of high importance. 2000 was a turbulent year on Dear readers the financial markets. Against this backdrop, Credit Suisse Group stock put in a varied performance and, after Credit Suisse Group had another suc- climbing to an all-time high in August, Lukas Mühlemann cessful year. Even in the challenging closed at end-2000 just below its clos- Chairman and Chief Executive Officer second half of 2000, the Group ing price for the previous year. Over a succeeded in sustaining its strong per- five-year horizon, however, the share formance of the first six months, and price rose by 22% per annum. net operating profit for the year rose by Between 1996 – prior to its com- a total of 35% to CHF 7.2 billion. plete restructuring – and 2000, Credit Instead of a dividend, the Group’s Suisse Group achieved sustained Board of Directors will propose a par growth and demonstrated high earn- value reduction of CHF 8 per share to ings strength. Revenue rose by an av- the Annual General Meeting on erage of 22% per annum and assets 1 June 2001. This distribution com- under management grew annually by pares to a dividend of CHF 7 for 1999 22% during this period. Operating and CHF 5 for 1998. earnings per share increased by 33% The Group further strengthened its per annum and operating return on eq- position as one of the world’s leading uity advanced from 9.8% to 21.5%. financial services companies through We are confident that we will be able to the implementation of a number of maintain strong momentum in the strategic initiatives in 2000. The year future. saw the launch of a host of new ser- While organic growth is the key to vices and innovative products, under- realising this objective, we also aim to lining the Group’s dynamism and its ef- close strategic gaps via targeted acqui- forts to provide professional, high- sitions. quality services in response to all of its The acquisition of US investment clients’ financial needs. The use of new bank Donaldson, Lufkin & Jenrette 4
  6. 6. “The year saw the launch of a host of new services and innovative products, underlining the Group’s dynamism and its efforts to provide professional, high-quality services in response to all of its clients’ financial needs.” (DLJ) last autumn is the largest and financial services providers also face most challenging move by the Group ever-greater challenges: in addition to since its 1997 merger with Winterthur. vying for good staff, they are confront- The integration of DLJ will significantly ed by increasingly fierce competition strengthen Credit Suisse Group’s posi- between the most powerful companies tion in its two strategic core areas of in the fields of banking and insurance, business, investment banking and as well as from new rivals outside the asset management. In addition, the industry. Credit Suisse Group is very Group made a number of smaller well positioned to meet these chal- acquisitions to strengthen its asset lenges. gathering and asset management busi- Our Annual Review – which we are nesses. issuing in addition to our Annual During 2000, the Group introduced Report – and our website will provide Value Based Analysis (VBA), an ac- you with a host of information on every cepted measure of value creation. VBA aspect of Credit Suisse Group. subtracts the cost of capital used in the On behalf of the Board of Directors business from cash flow in order to of Credit Suisse Group, I wish to thank measure value created in a given our shareholders and our clients for the period. We will use VBA in both perfor- trust that they place in our institution. mance measurement of our business We also owe sincere thanks to our units and in management compensa- 80,000 employees for their commit- tion. We have also introduced Economic ment to client service all over the globe. Risk Capital (ERC), which is a consis- tent measurement of the capital need- ed to cover all identifiable risks under extreme conditions. ERC will form an integral part of our capital allocation process. Lukas Mühlemann Future prospects look very attrac- Chairman and Chief Executive Officer tive for financial services companies such as Credit Suisse Group. However, March 2001 www.credit-suisse.com 5

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