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1. Credit Suisse Lost $2 Billion Before UBS Rescue
Credit Suisse Group's latest earnings report shows the bank in crisis mode ahead of its rescue via acquisition by UBS Group.
"The Swiss bank lost more than $2 billion from its businesses in the first quarter, but posted a prodigious net profit because of the paper gains realized from writing off $17 billion in bonds," The Wall Street Journal reports. "Customers withdrew around $75 billion in deposits, in a run that the bank says has moderated since the UBS deal announcement on March 19. Revenue fell across its investment-banking and wealth-management arms and its domestic bank."
UBS agreed to buy Credit Suisse for $3.25 billion in a deal guaranteed by the Swiss government.
2. Turkey Still Waiting on Tourism Rebound
Businesses reliant on Turkey's typically booming tourism industry are still recovering the February earthquakes that killed more than 50,000 people, Reuters reports. Tourism numbers were nearly at pre-pandemic levels before the quakes but now are roughly 30% below 2019 levels.
Turkish officials were hopeful for a strong tourism year prior to the tremors, optimistic that inflows of money from international travels could help stem the country's economic issues. But the news agency reports Turkey has been unable to capitalize on strong travel trends across Europe.
“The year started strong in terms of bookings, but it became sluggish after the quake. Now bookings have recovered a bit but have not reached their previous pace,” said Kadir Ugur, chairman of Germany and Switzerland-based tour operator Bentour Reisen, which specializes in travel to Turkey.
3. Difficult Comps Obscure Strength of Hotel Performance in First Quarter
HNN's Bryan Wroten reports that while there are plenty of reasons for investors to worry, analysts covering publicly traded hotel companies say fundamentals in the industry remain strong ahead of first-quarter earnings reports — perhaps stronger then they appear on paper.
Disruptions in the first quarter of 2022 from the omicron variant have lead to some messy year-over-year comparisons. Michael Bellisario, director of equity research and senior analyst at Baird, said this might lead some investors to falsely assume growth is lagging.
“People in the public market, when they see slowing, freak out, and it doesn't matter if it's slowing because of a comparison issue, or there's actual underlying weakness,” he said.
4. Chicago City Council Approves Office-to-Hotel Conversion
In a reversal of a trend during the COVID-19 pandemic of converting hotels into different real estate asset classes, the Chicago City Countil has approved a $28 million plan to turn an office building at 446 E. Ontario into a hotel, Urbanize Chicago reports.
"Planned by Group Fox Management, the proposal would convert 100,000 square feet of the office space into 101 hotel rooms," the news outlet reports. "Previously doctors' offices, the plan would convert the sixth through 10th floors within the base of the building."
5. Amex Report Claims Corporate Travel Remains Strong
A report from Business Travel News Europe, citing data from American Express, shows corporate travel remained strong in the first quarter of 2023, increasing 41% year over year for the quarter. This comes despite airline executives noting a slowdown in that sector related to issues in the banking sector.
Total travel and entertainment spending the first quarter "was up from about $25 billion in each of the previous three quarters, according to Amex, which described demand as 'particularly robust,'" the news outlet reports. "The first quarter of 2022 included some impact on travel spending due to the spread of the omicron variant of COVID-19, which affected year-on-year comparisons."