Back in the black – UBS posts billion-dollar profit in the first quarter – News

  • UBS is back in the black.
  • After two quarters of losses, the big bank earned $1.76 billion between January and March, it announced.
  • This means that it has clearly exceeded market expectations.

In the previous year, the bank – without CS – made a profit of 1.03 billion. The starting quarter of 2024 is the third quarter in which the acquired CS is fully included. In the two previous quarters – the third quarter and fourth quarter of 2023 – UBS reported a loss after the result exploded to almost 30 billion in profit in the second quarter of 2023 due to the CS takeover for accounting reasons.

Before taxes, there was now an increase of $2.38 billion in the first quarter of 2024. On an adjusted basis it was 2.62 billion. In particular, the Global Wealth Management and Investment Bank divisions significantly improved their results compared to the previous quarter.

Integration is progressing quickly

The big bank is already expecting the next important step in the CS integration at the end of the month. The completion of the merger of the legal entities UBS AG and Credit Suisse AG, which are still managed separately, is expected on May 31, it is said.

But further progress has already been made to date. In the first quarter, further gross cost savings of around 1 billion were achieved, of the 2 billion targeted for 2024. By 2026, UBS wants to reduce annual costs by a total of around $13 billion compared to 2022. This means that the cost-income ratio, which is important for a bank, also improved to 80.5 percent in the first quarter.

Legend:

UBS is back in the black after two loss-making quarters.

Keystone/Michael Buholzer

In its core business – global asset management – ​​the major bank was able to acquire additional customer money. The net inflow of new money in this area amounted to 27.4 billion dollars. As of the end of December, UBS managed assets totaling $5,848 billion across all areas, compared to $5,714 billion at the end of 2023.

Assessment by SRF business editor Jan Baumann


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The figures show that UBS is making rapid progress with the integration of the acquired Credit Suisse. It’s obvious: CEO Sergio Ermotti is accelerating. He is ensuring that costs fall quickly, for example through the legal merger of UBS and CS at the parent company level. This should take place by the end of May. The staff will also be further reduced, as previously announced.

Management is also significantly scaling back certain CS business activities that UBS no longer wants to continue. This is important. This tends to reduce the need for equity capital as a risk buffer. All in all, UBS is showing good numbers today and appears confident.

Bank boss Sergio Ermotti was very satisfied. A profit was made again this quarter and additional capital was built up. “A little over a year ago, we were asked to play a critical role in stabilizing the Swiss and global financial systems through the acquisition of Credit Suisse, and we are keeping our promise.”

As usual, UBS is cautious about the future. Ongoing geopolitical tensions and uncertainty over the timing of monetary easing in the Eurozone, the US and Switzerland would create uncertainty for the economic outlook, it said.

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