UBS Q3 Profit Down; Stock Rises

Swiss banking giant UBS Group AG reported Tuesday lower profit in its third quarter with weakness in all segments. Looking ahead, the company said it remains disciplined on risk management and cost efficiency as it heads into the fourth quarter. UBS shares were gaining around 5 percent in the morning trading in Switzerland.

The bank recorded $17 billion of net new fee-generating assets in Global Wealth Management and $18 billion of net new money in Asset Management in the quarter.

Ralph Hamers, UBS’s Group CEO, said, “For the quarter, we delivered good financial performance, with higher net interest income partly offsetting the impact of lower market levels and client activity.”

Hamers added that the bank continues to execute its strategy across all key regions. In the US, the company is driving scale and productivity, improving profit before tax margins and positioning business for future growth, all supported by strong advisor hiring. In APAC, there are strong growth opportunities.

In its third quarter, net profit attributable to shareholders fell 24 percent to $1.73 billion from last year’s $2.28 billion. Earnings per share were $0.52, compared to $0.63 a year ago.

Profit before tax declined 19 percent from last year to $2.32 billion. Operating expenses decreased 6 percent.

In the segments, profit before tax dropped 4 percent in Global Wealth Management, 2 percent in Personal & Corporate Banking, 34 percent in Asset Management and 47 percent in Investment Bank.

Total group revenues were down 10 percent to $8.24 billion from last year’s $9.12 billion. The results reflects a 6 percent drop in net interest income to $1.60 billion, and a 20 percent decline in net fee and commission income to $4.48 billion.

Global Wealth Management’s total revenues decreased 4 percent from last year to $4.79 billion, despite 23 percent rise in net interest income.

In the Personal & Corporate Banking segment, total revenues increased by 5 million Swiss francs, while net interest income decreased 1 percent. Total revenues from Asset Management were down 13 percent and from Investment Bank was down 19 percent.

Further, the company said it expects to repurchase around $5.5 billion of shares during 2022. The company repurchased $1.0 billion of shares in the third quarter, and $4.3 billion in the first 9 months of the year.

In Switzerland, UBS Group shares were trading at 15.86 francs, up 4.8 percent.

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