Updated from 1:18 a.m. EDT

Credit Suisse ( CS) swung to a profit of 2 billion Swiss francs ($1.72 billion) in the first quarter from a year-earlier loss of 2.15 billion francs as the bank cut costs and strengthened its capital position.

Analysts had predicted a net profit of about 726 million francs for the first quarter.

In a statement Thursday, the Swiss bank said core net revenue rose to 9.56 billion francs from 2.93 billion a year earlier.

"We believe that these results, in particular our strong return on equity, show that our differentiated strategy and our robust, integrated and capital-efficient business model with a low risk profile can be a powerful generator of earnings," said CEO Brady Dougan.

Credit Suisse embarked on a major cost-cutting drive last year, slashing 11% of its work force in an attempt to reverse a series of quarterly losses that amount to 8.2 billion francs in 2008 -- the worst loss in the bank's 153-year history.

Many of the job cuts fell in its investment banking business, which had caused billions in writedowns for the whole group.

Investment banking reported pretax income of 2.4 billion francs in the period, a swing from a year-earlier pretax loss of 3.42 billion francs.

Return on equity in the first quarter was 22.6%, the bank said.

Credit Suisse said first-quarter pretax income at its private banking operations fell 25% to 1 billion francs, with net new assets of 11.4 billion francs on strong inflows from both its international and Swiss businesses.

Net writedowns from investments in mortgage-related securities amounted to 1.4 billion francs, the banks said. This compares with 6 billion francs in the same quarter last year.
Copyright 2008 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. AP contributed to this report.

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